Globo Share Discussion Threads

[rec0very stock] 07/1/2016 10:07

RCT read post 7777 on this thread.

The FRC is investigating, they are good and will fine GT and individuals if warranted. They will also publish the result of their investigation - it will take some time. As a result of this there may be scope for legal action against GT, but it would need to be taken by the administrators and would be funded by the secured creditors who would be the only people to benefit from any proceeds.

[masurenguy] 07/1/2016 09:54

"Write off your investment as a capital gains loss - make sure you register that loss so you can carry it forward over the next 3 years to offset any future gains."

Reported tax losses have an unlimited timeframe to offset against future capital gains - they're not erased after 3 years.

[rcturner2] 07/1/2016 09:41

ihatemms, do auditors have a duty of care to shareholders and so can be sued for negligence?

A genuine question, I would like to know the answer?

Preferably if you can reference case law where this was tested?

[rec0very stock] 07/1/2016 09:37

Having read the administrators' report, I have to agree with Rupert. The fraud was buried deep in the subsidiaries, most of which are completely worthless and some have filed for bankruptcy already. The secured creditors are going to take big losses. The report talks about possible recovery actions, but even these will not provide anything to unsecured creditors, thus shareholders are completely out in the cold. I don't know if the CFO was still trying to cover up in his statement of affairs or whether he truly is that clueless about the true value of the group, but it does look like Costis fooled everyone even his own CFO. Even the Grego report that exposed this vastly underestimated just how bad it really was!

Write off your investment as a capital gains loss - make sure you register that loss so you can carry it forward over the next 3 years to offset any future gains. But those who have taken big losses need to learn the lessons - don't invest more than you can afford to lose and don't ignore the warning signs - there were plenty out there, well before the Grego report. If you fail to learn these lessons you will never have any future gains to offset against your losses.

The only people who seem to be doing well out of this debacle, apart from those who were short of course, are the administrators; they have already racked up fees of over 300K and estimate they will rack up over 300K more before they are done!

[rupert the bear] 05/1/2016 20:05

Sorry to have be the bearer of bad tidings but your "Significant losses" are your fault alone. And chasing the auditors will ultimately be fruitless.

[saint or sinner?] 05/1/2016 18:27

... oh and Rupert you still keep making yourself look an even bigger tw@t with each post you make. I don't remember seeing that in the Annuals when I was younger, but I guess times change, clearly not always for the better.

[ihatemms] 05/1/2016 17:58

For the record Rupert I'm a qualified accountant - who trained with a top 4 UK accountancy firm and I do understand the role of auditors.Enough said.

[ihatemms] 04/1/2016 20:20

Yes -the auditors report is for the shareholders and they give their opinion for the benefit of the shareholders . And I should know because like many on the bulletin boards I originally trained in audit.

[topvest] 04/1/2016 18:40

Auditors actually owe a duty of care to the company's shareholders or members.

[saint or sinner?] 04/1/2016 18:23

I guess Rupert The Bear's New Years Resolution wasn't to 'stop being a tw@t' then?

[rupert the bear] 04/1/2016 13:52

There's a document pending publication at Companies House:



A so called "Statement of administrator's proposal".

[rcturner2] 04/1/2016 12:28

It's like the whole thing came out of the blue.

Wait ... it didn't.

[smithie6] 31/12/2015 20:05

Hpcg
I disagree
imo an audit needs to check the individual sales papers add up to the claimed total.....and that money moving in and out adds up....

Hence a basic audit will check that money reported as sent to bank arrives in the bank account and that none gets lost on route.
Imo an audit should see that for claimed sales that there are papers for making that happen. Money going out to buy parts. Money to workers to assemble. Money for shipping. Money for taxes & vat. If none of that exists or is from companies that dont exist or....imo an audit should detect/see that.
I have no audit knowledge but imho the auditor is also guilty and should be jointly liable for investors losses..phps in secondary status.

[smithie6] 31/12/2015 19:54

Personally I think the auditor must go to prison, not just the guilty parties.
The auditor imo clearly imo did not do any of the basic work they are required by law to do, an audit. If just sign agreement to papers presented by the FD and taking big chunk of audit money but not doing the audit is imo criminal fraud & according to law gets a severe punishment.
( I lost nothing since I didnt trust the accounts, getting out around 30p on the way up (Im an experienced skeptic !) .....but the mkt needs accounts to be true...otherwise the 'mkt' is a farce)
----

Btw have the authorities frozen the assets of the MD & FD ..including from share sales ?
Important first thing to be done by the system imo.

[topvest] 31/12/2015 16:46

Audits are not designed to detect minor frauds, but they are supposed to spot accounts that are materially fictitious which these clearly were. I think we all invested on the basis that the numbers were materially correct and signed-off with a clean audit opinion by a reputable audit firm. Clearly, they were made-up numbers and the auditors, unfortunately, had the wool pulled over their eyes. They should have validated the customer revenue more thoroughly and made contact with their customers. I suspect that the cash balances were also fraudulently supported as well as it seems highly unlikely that the cash pile was spent in the time since the last audit, but we don't know that for sure. I certainly wouldn't like to be in the position of the audit partner that missed this one as he is no doubt in for a difficult time. Incidentally, ShareSoc have just written to all holders and asked them to join a Globo Shareholders' Action Group. I've joined.

[hpcg] 31/12/2015 11:52

Audits are not designed to catch fraud, they are a check that the accounts are consistent. Audited accounts and institutional investors on the register are no guard against fraud or bankruptcy.

The cash question was and is (for the future) easily answered; companies which hold cash do not need to take on debt or raise equity. This includes the likes of GSK (I hold) and IBM, which have increased borrowing to fund shareholder returns in excess of the cash they generate.

[gemstar2] 26/12/2015 08:23

Cash is always king in this sort of company

Investors need to remember this

[joe say] 22/12/2015 14:41

Cue a delayed report + cover/stitch up