Author: Niall Hearty 8 July 2022
The former chairman of Patisserie Valerie is set for a large pay-out after auditors settled a £200 million court case regarding the café chain’s collapse.
Luke Johnson is believed to be one of the main creditors that will benefit from the settlement of the case that was brought against Patisserie Valerie’s auditors, Grant Thornton.
Liquidators for Patisserie Valerie sued Grant Thornton following the 2019 collapse of the café chain. Allegations of fraud surfaced soon after problems with Patisserie Valerie’s accounts were recognised. Grant Thornton had audited the company for 12 years and had not spotted any alleged manipulation of the accounts.
An investigation by the Serious Fraud Office into the accounting practices of some individuals associated with Patisserie Valerie is ongoing. Grant Thornton has already been fined £2.3 million over its role in the café chain’s demise.
There is little doubt that systemic failures in Patisserie Valerie’s auditing went unnoticed. The result of this was a financial crisis that is still being assessed three years on – and the fall-out shows little sign of coming to an end in the near future.
The accounts for Patisserie Valerie had been overstated by an astonishing £94 million. That alone is a huge figure. It is, however, dwarfed by the sum that has just been paid out.
While the precise details of how the company came to be in such a mess are yet to be known, there is little doubt that the systems that were in place to prevent or identify such problems were not good enough. The huge amounts of money that are now part of the Patisserie Valerie saga are an indicator of how high the costs can be if the right systems are not in place.
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