By Patrick Avenell
MELBOURNE, VIC & SYDNEY, NSW: An internal investigation, running concurrently with external auditors, is currently examining Clive Peeters’ missing $7 million. Despite this extraordinary news, which includes the suspension of trading on the ASX, CEO Greg Smith said it was business as usual in the group’s retail stores.
In an interview with Current.com.au this morning, Smith outlined what had occurred up to and since Friday’s report to the Australian Securities Exchange.
“We lodged a request for a trading halt last Friday, and in that [letter] we advised there were accounting irregularities being discovered and that investigations were under way,” said Smith, who emphasised how legally sensitive this issue was, and how that sensitivity is restricting what he can say on the matter.
“What I can say,” Smith continued, “is we’ve made progress. The investigations are proceeding well.”
Clive Peeters has experienced a rollercoaster ride since its listing in 2005. During 2007, the group traded at over $3.40, with further trading highs expected. But as the economy turned, so too did Clive Peeters’ share price, and a low of 6 cents was recorded in November last year.
At that time, fears for the company’s long term viability were aired, including on this site. Once again, there are media reports today that the company is on the brink of collapse. We asked Smith for his response.
“Any suggestion that the company is on the verge of collapse, or anything like that, is absolutely and utterly refuted. The investigation is proceeding and we expect to make an announcement next Monday,” he replied.
Smith said that the investigation into the $7 million shortfall, which is expected to blow out Clive Peeters’ FY09 loss from around $5 million to close to $12 million is being conducted by both internal parties and an outside auditor.
It is not yet known how this $7 million disappeared from Clive Peeters’ coffers. That is, no information is currently available as to whether it is a shortfall in revenue, an unaccounted expense or an appropriation anomaly. That information is expected to be released to the market on Monday.
“Voluntary suspension of trading expires next Monday,” said Smith. “We’re trying to get into a situation where we can give a full update to the market before Monday when that period expires.”
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