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CMS Kidderminster of Churchfields, Kidderminster, Worcestershire has called in administrators FRP Advisory.
Administrators Anthony John Wright and Rajnesh Mittal were appointed on 16 August. FRP confirmed to Motor Trader that the company continues to trade.
In April this year the directors of submitted accounts to Companies House where they disclosed in the strategic report a stock discrepancy of £3.7m in the accounts in relation to a stock contra account that they were unable to reconcile as of 31 December 2021.
“After several detailed investigations the directors have so far not been able to provide sufficient evidence to support £3,689,292 of stock.
“The directors are continuing to investigate the stock difference and have engaged with professional advisors in order to determine the appropriate accounting treatment.
“The directors are also working to ensure that the systems and processes ensure that no such issue could not occur again.”
“The 2021 financial statement show that a significant trading profit before tax was mad of £487,475 and our forecasts and ongoing trading continue to support this.”
Directors said the uncertainty relating to the £3.7m of stock on the balance sheet had not directly affected the trading ability of the company during these years and the ability to return a trading profit with the support of the Stellantis group.
The auditors noted that if the company was required to pay off the stock balance in question current liabilities would exceed its total assets by £2.9m.
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