Another accounting scandal on AIM, but the warning signs were there
Having previously assured investors that it had identified the full extent of accounting errors, advertising group M&C Saatchi has now warned that matters are far worse than it previously thought. Thankfully there were warning signs for those who took a close look.
An independent review by PwC has resulted in advertising agency M&C Saatchi (LON:SAA) making adjustments of £11.6m to its 2018 and 2019 financial statements, nearly double the £6.4m it previously considered as a worst-case scenario. To put this into context, for the year ending 31 December 2018 the group generated net income of only £11m on £420m of sales. Chris Boxall of specialist fund manager Fundamental Asset Management has often been surprised at the company's ability to weather the storms of the marketing industry which have brought down several far better established peers, including WPP (LON: WPP). Now management has announced that trading…