Page 17 - Auditors Article

Administration: a Court order is obtained which
stops all legal action including HM Revenue and

Customs, banks, bailiffs and suppliers. This gives

time to evaluate the situation and decide whether

to keep trading, sell the business or close it down.

The Company exits the administration process and
continues as a going concern, albeit in restructured

form, or if the administration has not been able to
restructure and/or find a buyer, then the likely

outcome is either a CVL, Compulsory Liquidation or

Dissolution. Patisserie Holdings were sold.

The Patisserie Valerie fraud was likely to have been very

sophisticated. What seemed at first sight feasible was not so

“The case is unusual because less than two months before

administration, investors were asked to put in money on the

basis it would be sufficient money to protect the business,
which turned out not to be the case.” [Bonney, S, 2019] These

investors e.g. Luke Johnson, had now lost this money.

Furthermore, investors such as Mike Ashley of Sports Direct

who attempted to acquire Patisserie Holdings Group out of
administration, in order to "trim off the fat" as he had done

with other acquisitions such as Evans Cycle chain bought out

of administration for £8m and House of Fraser for £90m.