Richard Eyre

Next Fifteen investigation into £1.8 million embezzlement costs company another £300,000


By Stephen Lepitak, -

January 29, 2013 | 3 min read

Next Fifteen Communications investigation into the fraud discovered within Bite North American offices will cost the group around £300,000 before it begins to implement additional resources of around £250,000 each year to prevent it reoccurring.

Last year the company delayed the release of its financial results when it opened a fraud investigation, which included informing the Federal Bureau of Investigation.

Upon releasing its figures, it was revealed that the fraud cost the company £1.8 million, which Next Fifteen chairman Richard Eyre described as "an act of personal embezzlement by a long-standing member of the finance team in a trusted position."

The embezzlement is understood to have been conducted by a long-term member of staff within its finance team.

"The required accounting adjustment has been to write off as an exceptional item £1.8m relating to unrecoverable assets and unrecorded liabilities, reflecting cash stolen from the business," added Eyre. "The fraud continued into the early part of the current financial year, which will require a further write-off of £0.1m. This crime is now being investigated by the FBI and the SFPD,” he added.

The latest figures for the company for the start of the current financial year, 1 August 2012, has now revealed the cost of the investigation and the cost of solving the problems that allowed the embezzlement to take place.

New measures will be introduced during the second half of the financial year, Eyre has revealed, and added that he believed that no further write-offs would be made following the figures already released.

“Without the one-time costs relating to the fraud investigation and resulting staff changes, the Group is expecting to meet management targets for the full year, but first-half profits will be held back by the planned investments in the new insight business and staff transitions in some of the traditional businesses,” he added.

The company is expected to release its interim report on 23 April, with Eyre describing the company’s balance sheet as ‘strong’.

Richard Eyre

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