Gowrings investigates employee over accounting irregularities
Thursday 20 March 2003
Gowrings, the Burger King franchisee, is investigating one of its employees on suspicion of fraud after unearthing accounting irregularities.
The group said it had discovered irregularities totalling £1.6m before tax in its motor division. The news sent its shares tumbling 13 per cent to 42.5p.
The sums related to three motor dealerships that Gowrings sold last summer, which paved the way for it to focus on expanding its Burger King estate.
Derek Coulson, the chairman and chief executive, said he had pin-pointed responsibility for a "number of false accounting entries" to one employee.
Mr Coulson added: "I don't know whether there is a fraud involved or not."
Mr Coulson said progress of the investigation had been complicated because the employee at its motor division, was "off ill". Gowrings has appointed external advisers to assist the group's auditors, Moore Stephens, he added.
In a trading update, the group said its existing cash position and the underlying cash flows from its retained businesses were unaffected.
It has delayed the publication of its full-year accounts until at least the middle of April while it completes its investigation.
Mr Coulson said the false entries stretched back at least as far as 1999 "and may well go beyond that". Last summer, Gowrings sold car dealerships in Wokingham, Bracknell and Newbury as well as a body repair centre in Newbury.
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