The public perception is that if anyone knows how to keep a company afloat,
it should be accountants. So when accountants lose their grip it’s a shocking
event, albeit morbidly fascinating.
Such is the grim curiosity surrounding the demise of Wenham Major, the
Birmingham firm that stormed into the Accountancy Age Top 50 with stella growth
rates over the past few years. The firm revealed ‘financial irregularities’ a
couple of weeks ago and such was the blow it entered administration and was
finally sold off to Bentley Jennison at the end of last week.
Joint owner John Joyce is said to be in hospital and is currently unavailable
while his colleague Ammar Azam was said to be overseas.
But firms don’t go out of business too often. This is the largest failure
since Andersen back in 2002. Of course. there are differences. Andersen’s
collapse was a reputational issue. There was not a financial management question
mark. Wenham had both issues to contend with a fatal combination.
Even if the firm could work its way out of administration, the damage to its
reputation would be tough to overcome.
Events at Wenham reinforce what a precarious profession accountancy can be.
Suffer one blot on the copy book and it could be your last. The mantra of the
profession is ‘reputation, reputation, reputation’. Without it you simply don’t
have the basis for retaining your clients.
Bentley Jennison’s managing partner Tony Stockdale now faces the task of
calming the Wenham clients to convince them that things will be better now. It’s
a tough job depending on just how spooked they are. As we know from the Andersen
episode, watching your auditor or accountant crumble is a frightening
Gavin Hinks is editor of Accountancy Age
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