Tiscali auditors deal company another blow
More bad news for Tiscali today as Ernst & Young, Tiscali's auditors, dished out another blow by refusing to sign off on the accounts for year ending 2008 citing "the fundamental uncertainties on business continuity". They reported that the group's future was dependent on the successful conclusion of debt negotiations with its banks.
Tiscali put themselves up for sale last year to try and raise capital to cover costs of impending debt repayments however due to the decline of the economy, have not been able to find a party willing to pay its high price. The latest offer from BSkyB of around £350 million for the UK arm falls far short of the £600 million the company was originally expecting.
"The company, in disagreement with the conclusion drawn by the audit report, believes that it has co-operated at best and that it has provided all the information necessary to enable the independent auditors to issue an audit opinion on its 2008 financial statements.
"In particular, with regard to the process of debt negotiation, the company underlines that it has already obtained a period of standstill from the lending banks until June 2009."Tiscali Statement
The news will likely be of concern to Tiscali's debtors who may be looking to limit the damage. Tiscali can appoint new auditors but they may well come to the same conclusions.