Watchdog launches probe into accountant Mazars over its audit of collapsed Studio Retail Group
The accountants who audited the books of Studio Retail Group before it collapsed and was bought by Mike Ashley are under investigation.
The Financial Reporting Council (FRC) has kicked off a probe into Mazars over its work at the stricken home shopping company for the year to March 2021.
Studio Retail, which sells clothes, homeware, toys and gifts, went bust in February this year before being rescued by Ashley’s Frasers Group in a £27million deal.
Questions: The Financial Reporting Council has kicked off a probe into Mazars over its work at Studio Retail Group for the year to March 2021
Mazars said it would ‘co-operate fully’ with the FRC investigation.
The probe could lead to a fine for the company, one of the UK’s largest accountants outside of the so-called Big Four.
The FRC could also fine or sanction the individual auditors involved. Frasers Group declined to comment on the investigation because it relates to accounts from before its takeover of the firm.
It comes as Ashley prepares to step down from the group at its annual meeting this month – leaving his son-in-law Michael Murray in charge.
Murray has vowed to rebuild bridges with the City after years of criticism for Ashley’s management style.
Studio Retail collapsed under the strain of soaring shipping costs and supply chain delays, which left it with more inventory than normal and cash flow troubles