Page 13 - Auditors Article

Furthermore,

“The Audit Committee has primary responsibility for

monitoring the quality of internal controls and ensuring that
the financial performance of the group is properly measured

and reported on. It receives and reviews reports from the

Company’s management and auditors relating to the interim

and annual accounts and the accounting and internal control
systems in use throughout the group. The Audit Committee

meets at least three times a year and has unrestricted access

to the Company’s auditors. The Audit Committee is chaired by
Lee Ginsberg and its other members are James Horler and

Luke Johnson.”

The question here is ‘how cozy’ is this relationship between
financial governance and the Audit Committee? In the final

analysis it comes down to fraud and the position of the

individual or group to both perpetrate it and hide it. If this

relationship was to be found wanting then what could have
been done to prevent the fraud – better use of non-executive

directors perhaps, minimising the opportunity?

Administration is used, as was the case with Patisserie

Holdings plc, when it is considered that at least part of an
insolvent business can be sold or salvaged. Administration is a

formal insolvency process where the administrator acts in the

best interests of the creditors, such as holders of floating

charges (often a bank or banks) who can force the
appointment of an administrator if the company has not

upheld the conditions of any debenture agreement. Normally,