Frasers Group’s brands, I Saw it First and Choice, face significant audit issues, raising governance concerns.
- Auditors for I Saw It First couldn’t verify nearly £7m in wages, causing alarm over financial oversight.
- Choice’s auditors missed crucial information following a change in ownership from JD Sports at the end of 2022.
- I Saw It First lost some payroll data during a switch to Frasers Group’s accounting systems, which exacerbated the issue.
- These developments revive worries about Frasers Group’s corporate governance, following historical financial reporting concerns.
Frasers Group’s fashion brands, I Saw it First and Choice, are embroiled in audit-related challenges that have brought their corporate governance into question. The I Saw It First brand, acquired by Frasers Group, encountered difficulties when almost £7 million in wages and salary payments could not be verified by auditors at Cooper Parry. This revelation calls into question the financial integrity of the brand’s accounting practices.
Auditors for Choice, another brand under the Frasers umbrella, were similarly unable to obtain necessary information crucial for completing their assessment. Choice was previously owned by JD Sports until its acquisition by Frasers Group in late 2022. This lack of documentation has disrupted the auditing process and heightened scrutiny towards the group’s financial management capabilities.
The issues stem from a loss of payroll data at I Saw It First, attributed to a transition in accounting systems post-acquisition. A company spokesperson explained, “A limited set of I Saw It First payroll data can no longer be accessed because it was not migrated on to Frasers Group’s systems during the post-acquisition integration process, and the I Saw It First system which it was stored on no longer exists.”
The audit complications have resurfaced longstanding concerns regarding Frasers Group’s corporate governance. This comes in the wake of an investigation by the Financial Reporting Council into the accounts of Sports Direct International, the precursor to Frasers Group, for the period ending April 2016. The investigation led to a significant fine of £1.3 million against Grant Thornton, the company’s former auditor, due to “serious failings” in the review of the retailer’s accounts.
These audit issues suggest a need for Frasers Group to strengthen its financial governance frameworks.
