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Lester Bangs

Apr 19, 2007
So I was thinking last night about the reason that the embargo was in place was that the Accountants would not release the completed Financial Statements until they had received payments (and rightly so, they aren't a charity and they provided a service).

Now this got me worried again as it appears that we are unable to pay our debts as and when they fall due, this ultimately means that the Sainsburys money we drew down on must have been spent already and our cashflow position is diabolical again.

Then the thought occured to me that maybe we could afford to make payment, after all our cash position can't be so bad that we can't afford to pay them right, RIGHT? but for some reason we were withholding payment, this appeased me as it meant that our cashflow was not so bad that we couldn't make payment we just weren't happy with the service that we were being provided and have decided not to pay.

That then got me thinking, well if this was the case what weren't we happy with? The preparation of the Financial Statements? No, that should be easy enough and shouldn't provide controversy. The Audit? Possibly, are the auditors going to qualify the report? Maybe on a going concern basis? Lastly the disclosures? There could be ample reason why there could be disparaging disclosure and this could be a reason for wanting the accounts to be changed.

Obviously this is all conjecture and just my thought process but I was wondering what people though was the better scenario:

1) Not having the money in the first place to pay the Accountants for the work they've undertaken.

2) Witholding monies in an attempt to get the Financial Statements changed and to avoid harmful disclosure or a qualified audit report as the club felt the disclosure were misrepresentative?

Again, I must stress that this scenario is purely fictional just thinking when I worked in Practice that the main reason Accountants didn't get paid wasn't due to the client not having the money but witholding money and the holding the firm to ransom as they were unhappy with what was being reported.