Arena TV is understood to have borrowed about £300 million from asset-based lenders

Fine place to get money from if you’ve got an asset heavy business to run.

an auditor, acting for one of Arena TV’s lenders, attempted to verify serial numbers for company-owned equipment used as security for loans. When the auditor called the equipment suppliers, they were told the serial numbers did not exist.

Ah, not so asset heavy then.

I assume the auditor wasn’t reading the numbers off the back of the kit because if that were true then it would mean it had more assets than thought. Must be the numbers on the paperwork that don’t exist…..

11 thoughts on “Ah…..”

  1. Bloke in North Dorset

    How naïve can they get? We worked on the DD for a loan to a tower company and as part of it we sent an engineer and management consultant to every single site to check equipment schedules. It took 4 weeks at no small cost, but that is what you need to do.

    Caveat emptor.

  2. For a normal asset audit you would look in the capital asset register, check that the entries looked consistent then select a random sample. If the firm were not able to confirm the physical location for verification an eyebrow would be raised though it’s not necessarily an immediate cause for concern. The next step would be to check the maintenance contracts at which point the vendor would tell you they are not under maintenance as they are not valid serial numbers. That would be a very significant audit finding.

  3. What’s the point of a TV company having lots of assets? Surely better to lease the kit, like airlines or construction companies.
    In a final analysis a TV company’s “assets” are the talent and the audience, both hard to put a $ sign on.

  4. This is the asset company. They had the assets which were then rented out to TV companies for a specific production.

  5. What could be simpler than taking an inventory of a wine cellar? But I have a tale of an accountant who described his method to me, leaving me gobsmacked at his stupidity.

    The tattie is not the only bloody fool in that trade, eh?

  6. Bloke in North Korea (Germany province)

    Most rent-out AV kit is used for events, shows, conferences, etc rather than telly production, isn’t it?

    No surprise they can’t make money.

  7. Bloke in North Korea (Germany province)

    dearie, has anyone ever audited Fort Knox?

    And here, Mr Auditor is room 1 full of gold.

    Now if you would kindly step this way and let the forklifts through, is room 2 full of gold.

    Union rules mean we have a break now, would you mind spending half an hour in reception?

  8. @BiNK
    Cheaper and more effective to mess with the floor display in the lift. You can have an unlimited number of floors, no need for union breaks and a small team who quickly make small but obvious changes (position of the coatstand, floor signs etc) whilst Mr Auditor is in the lift.

  9. I know of a company that transported a huge safe halfway across Paris after inspection and installed it into another office whilst the auditor was treated to a lazy French lunch. After which he went to the second office counted the same contents again.

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