The administrators of a national metal manufacturer have appointed CAPA to conduct audits on the company, after the firm was hit by several issues including the soaring cost of materials.
RSM UK Restructuring Advisory, the corporate restructuring and rescue business, instructed CAPA to undertake the audits on First Components, which operated as a precision engineering business based in the West Midlands.
The manufacturer of metal structures and parts for supply chain companies had been trading for nearly 18 years. It had served a wide range of industries including aerospace, automotive, medical through to electrical, white goods and general engineering, but was affected by a series of financial problems throughout 2021.
In August, the company lost a major customer and suffered a related decline in turnover. At the same time, management costs increased and inflation drove up the costs of materials it needed to operate.
Ultimately, Diana Frangou and Gareth Harris of RSM UK Restructuring Advisory, Birmingham, were appointed as joint administrators in January 2022.
The administrators explained in a report that cashflow issues coupled with a sudden change in ownership and structure resulted in their appointment, which was made to protect creditors’ interests especially the employees.
As the administrators look to recover value from the business for creditors, they have appointed CAPA to conduct a rates audit at all sites First Components traded from.
This means CAPA’s Audit team will use bespoke software to conduct a forensic inspection of rates paid to local authorities at sites where the company was located.
The team will look to identify anomalies or errors, to recover any overspend and boost the overall returns to creditors.