Cox & Kings reports alleged fraud in account of UK-based arm Prometheon

Travel firm Cox & Kings on Monday informed that the newly appointed auditors of the company have noticed the use of "allegedly forged financial statements" in the accounts of its UK-based subsidiary Prometheon Enterprise.

The auditors of Cox & Kings have found that the audited consolidated financial statements of Prometheon Enterprise were not signed by Raffingers - the auditor of its UK-based arm.

Cox & Kings is presently going through corporate insolvency resolution process.

The allegedly forged financial statements were used by the previous statutory auditors of Cox & Kings while preparing consolidated financial statements of the company, the resolution professional of the company said in a regulatory filing, adding that now it stands "incorrect" since it was based on such "allegedly forged subsidiary financials".

The travel firm will soon share update in due course, once certainty over the people involved in such discrepancies are identified, it added.

"We wish to inform you that the newly appointed statutory auditors have come across the fact that the audited consolidated financial statements of Prometheon Enterprise Ltd as used for the purpose of preparation of Consolidated Financial Statements of Cox & Kings for FY 2018-19 were not signed by the auditor of Prometheon Enterprise Ltd i.e. "Raffingers".

"And allegedly forged financial statements were used by the previous statutory auditors for the purpose of consolidated financial statements while issuing their auditors report dated May 30, 2019 on Consolidated Financials," it said.

Pipara & Co LLP, Chartered Accountants, have been appointed as the statutory auditors of Cox & Kings by the Resolution Professional with effect from February 7, 2020.

It was approved by its lenders in the meeting of Committee of Creditors on January 30, 2020.

"The newly appointed Statutory Auditors, in the course of the performance of his duties as auditor, have a reason to believe that an offence of fraud involving Rs 1 Crore or above (individual amount), is being or has been committed in the Company by its officers or employees and accordingly correspondences to the Ministry of Corporate Affairs is in process," the company said in the filing.

The Mumbai bench of the National Company Law Tribunal in Mumbai has directed to initiate insolvency proceedings against Cox & Kings in October last year over the plea filed by Rattan India Finance, claiming default on a loan of Rs 30 crore by the travel company.