Frasers Group’s fashion labels, I Saw it First and Choice, are experiencing significant audit issues, raising concerns about corporate governance.
- Auditors at Cooper Parry could not verify £7m of wages at I Saw it First, according to financial reports.
- Choice faces similar predicaments with auditors at Hart Shaw missing crucial financial data following its acquisition from JD Sports.
- The transition to Frasers Group’s accounting systems has led to lost payroll data for I Saw it First, complicating audit processes.
- These issues have reignited scrutiny over Frasers Group’s corporate governance, echoing past regulatory challenges.
Frasers Group is currently confronting substantial audit complications involving its fashion brands, I Saw it First and Choice. These issues have sparked a renewed dialogue about the company’s governance practices. The financial auditors at Cooper Parry, responsible for evaluating I Saw it First, reported their inability to substantiate approximately £7 million in wages and salary payments. This revelation, highlighted by financial outlets, underscores significant auditing discrepancies within the organisation.
Concurrently, Hart Shaw auditors dealing with the brand Choice, which became part of Frasers Group after its acquisition from JD Sports at the end of 2022, disclosed that essential information required for completing their auditing processes was missing. Such deficiencies pose substantial challenges in validating the financial health and transparency of Choice under the new corporate structure.
The root of these auditing problems appears to be linked to the transition process involving Frasers Group’s accounting systems. A spokesperson from I Saw it First acknowledged this issue, explaining that a limited set of payroll data failed to migrate to Frasers Group’s system during the integration phase post-acquisition. Consequently, the original storage system for these payroll records is no longer available, exacerbating the auditing challenges faced.
In light of these developments, concerns regarding Frasers Group’s governance have been amplified. The Financial Reporting Council’s historical investigation into the company, known formerly as Sports Direct International, found serious failings in the audit of its accounts for the year ending April 2016. This led to a substantial fine of £1.3 million against the former auditing firm, Grant Thornton, which continues to echo in current regulatory conversations.
The current audit issues with Frasers Group’s fashion brands highlight ongoing corporate governance challenges that require strategic resolution.
