Grant Thornton LLP, the accounting firm that conducted financial audits for Kew Media Group, has withdrawn multiple previously released reports, including audits on a number of Kew financial filings from the past four years.
According to a statement from Kew, the auditor is withdrawing the reports as a “result of the actions” of Kew’s former CFO Geoff Webb and its “inability to rely on representations he made to Grant Thornton in the course of its audits and review of Kew’s financial statements.” The withdrawn reports include audits of Kew’s year-end financials for 2016 and 2017, with Kew stating that the reports “should no longer be relied upon.”
Webb’s departure from the company was announced a month ago, when Kew said it had appointed a special committee to examine strategic alternatives including the sale of all or parts of the company.
Kew also said on Wednesday it has formed a second special committee of independent directors to “investigate the actions” of former CFO Webb.
“The committee’s mandate includes an investigation of the extent to which working capital and the other financial information of the company was misreported to the company and its senior lenders and whether the company’s historical financial statements were impacted by such inaccurate information and require any amendment or restatement,” read a statement.
Due to the time it will take for the second committee to complete its investigation, Kew said it will miss the deadline for filing its year-end financial statement. In prior years, Kew has reported its year-end fiscal report in early April.
While Kew has not provided updates on the progress of the strategic review, private equity firms have emerged as the front-runners to acquire certain assets from the publicly traded company, which would likely de-list from the Toronto Stock Exchange following any such transaction.
Last week news broke that Jeff Collins, founder and president of Kew Media-owned U.S. prodco Collins Avenue Entertainment, was departing the company. Collins’ exit comes after Essential Media co-founder and CEO Chris Hilton and Bristow Global Media president and CEO Julie Bristow left their respective posts in November.
From Playback Daily. Image: Shutterstock