REPORTING watchdog the FRC has come under pressure from MPs to launch an investigation into the directors and advisers involved in the sale of BHS to Retail Acquisitions in 2015.
In a letter to FRC chief executive Stephen Haddrill, Business, Innovation and Skills (BIS) select committee member Richard Fuller urged the FRC to investigate those involved with the transaction shortly before the retail chain collapsed into administration.
“This transaction has raised serious questions about the efficacy of current regulations as well as director responsibilities,” the letter stated. “It has also drawn the issues of corporate reporting – both in terms of reports issued by boards of directors, and of reports required by boards of directors in transactions resulting in a corporate sale.”
The plea comes after the BIS select committee launched an investigation into the steps taken by Arcadia Group to ensure that Retail Acquisitions Limited (RAL) was a responsible owner.
The inquiry also looks at what checks were undertaken by RAL to verify that BHS was a going concern.
Former BHS owner Phillip Green sold BHS to Retail Acquisitions – led by Dominic Chappell, a former bankrupt and racing driver – for £1, when it was saddled with over £1bn in debts and a £571m pension deficit.
In his response, Haddrill said the FRC “is looking into the events at BHS to determine whether to investigate”.
Assessment of investors’ engagement with company boards is being stepped up, to ensure public companies are well run
The UK's top listed businesses are not exactly beacons of transparent and clear reporting, argues Brett Simnett, and their 'shyness' damages future prospects
The UK’s top public companies hide their pensions’ exposure risk from investors, potentially leaving companies open to another BHS-style pension funding scandal
Financial Director takes a more in-depth look at the EU's second attempt at introducing a common consolidated corporate tax base (CCCTB) announced yesterday