Legal worries put brakes on Rover accounts

Publication of the accounts of Phoenix Venture Holdings has been delayed
because of fears from its auditor, Deloitte, that PVH could face legal claims
relating to its subsidiary MG Rover.

A spokesman for PVH told Accountancy Age that Deloitte was delaying
publication because of a disagreement over the inclusion of provisions in the
accounts for legal challenges.

Deloitte is consulting administrators PricewaterhouseCoopers about the
likelihood of legal challenges against Phoenix. The spokesman declined to
elaborate on how large any provisions would need to be.

Phoenix’s accounts for the 2004 financial year will not themselves include
any mention of MG Rover, disappointing many who had hoped the numbers might shed
some light on the car company’s demise.

There has been no suggestion from the administrators so far that Phoenix
would be held responsible for any part of the company’s collapse.

Phoenix’s accounts were due to be filed at Companies House at the end of
January, with delays put

down variously to tax complications and other unresolved issues under
examination by Deloitte.

It is unknown when the company’s accounts will be published, with earlier
predictions that they would be out ‘within days’ proving inaccurate. The latest
suggestion was that they would be released by the end of last week.

The figures themselves will not include any reference to MG Rover, since
there is no obligation to report the activities of insolvent companies.

The accounts are expected to include some details on the remuneration of
directors and auditors.

The delay comes in advance of a report by the National Audit Office into
Rover’s collapse. The NAO is expected to put the boot into the DTI over the
£6.5m loan it made to administrators while they were looking for a buyer. The
company was eventually bought by Nanjing Automotive (pictured right).

Deloitte offered no comment on the provisions, saying that it would not
comment on client matters. PwC also declined to comment.

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