Patisserie Valerie reveals ‘devastating’ extent of accounting scandal
Patisserie Holdings, the parent company of the Patisserie Valerie café chain, has said that the past misstatement of its accounts was “extensive” and involved “very significant manipulation” of the balance sheet and profit and loss accounts.
Thousands of false entries were made into the company’s ledgers, the Birmingham-based company said, before an apparent £40m black hole was discovered last year.
The company has hired KPMG and RSM to help it recover from what it described as the “devastating effects” of the fraud.
Patisserie Valerie said cashflow and profitability had been misstated in the past and “is materially below” what the market was told in October, shortly after the accounting errors were first discovered.
The company warned it “will be some time to complete a restatement of the company’s accounts.”
Patisserie Valerie shares have been suspended since the fraud was first uncovered.
The police, the Financial Reporting Council and PwC, on behalf of the company, are continuing to investigate.
It added: “The company has appointed a new CEO, a new interim CFO, a new non-executive director, a new commercial director and a new production director, as well as other management appointments.”
Interim chief financial officer Nick Perrin is part of a new management team which has been brought together since November following the departures of finance director Chris Marsh and chief executive Paul May.
Steve Francis has come in as chief executive and Rhys Iley joined as group commercial director.