The news that Valerie confectionery – a company worth £ 440 million on Monday – is no longer a problem in progress without a # 39; capital injection is absolutely staggering.
Once the composure is reunited, the questions come thick and fast.
The answer to this question may depend on the answer to …
Question 2. How quickly did the black cash hole open?
Has it occurred in the last three years, last year, the last three months?
Black cash holes generally open when the finance department loses control of the process of reconciling bank money with accounts. If it accumulates quickly, it means that the company is emitting money and would make investors nervous to invest more money.
Question 3. What the financial director was doing
Chris Marsh has worked with Luke Johnson for over a decade. His current and previous associates tell me he is a "quiet boy", "not ostentatious – no gold watch or fast car", "definitely the man of Luke". It has been suspended while forensic accountants try to understand what happened here.
Question 4. Why did the auditors, Grant Thornton, not raise the alarm?
They signed the accounts in September 2017, stating that the financial statements were in accordance with the accounting records. This will be a specific concern for Grant Thornton and another question mark raised on the quality of the entire accounting profession after high-profile busts from the blue like Carillion.
Shops remain open for now. But without money, this can not last, as suppliers will simply stop delivering. The future of the company, its 206 stores and its 2,000 employees are very poised.