The administrators who rescued Evans Cycles from insolvency have appointed CAPA to audit nearly 80 properties across the retailer.
CAPA will be undertaking full property audits, as well as accounts payable audits, on 78 sites throughout the chain after PwC were called in as administrators in October 2018.
As a multi-channel business trading online and through 62 stores on Britain’s high streets, Evans Cycles employs around 1,300 staff. It has been one of the leading independent operators in its field since its formation in 1921.
Adverse weather during the start of 2018, brought on by ‘the beast from the east’ had impacted the company, along with a lack of cash to invest in stores and develop its online platform. A combination of losses, capital expenditure requirements and tightening credit had also led to a liquidity crunch.
Like other beleaguered retailers during the past year, Evans Cycles had also faced a range of wider financial challenges – rising business rates, an increase in the minimum wage and a fall in Stirling which made imports more expensive.
After the business suffered from tough ongoing trading conditions, administrators Matt Callaghan, Ian Green and David Baxendale, from PwC, were appointed on October 30.
Through a pre-pack administration, PwC were able to sell the business and assets of the company immediately to three companies, all of which are ultimately owned by Mike Ashley’s Sports Direct.
The administrators have now appointed CAPA to conduct the full property and accounts payable audits, which will involve CAPA carrying out a forensic analysis of all outgoing costs across the 78 sites.
Auditors will use bespoke software to uncover multiple elements such as errors or anomalies in utility bills, rates, service charges and all property related costs. Any ‘overspend’ discovered will then be recovered by CAPA for the creditors of Evans Cycles.
The team will also inspect data on invoices paid out at each site to establish if any more sums, due to overspend, can be recovered for creditors.
