Wednesday, 28 October 2015

Crowdcube wrong yet again

Yet another example of the very poor DD that Crowdcube use has just been posted on the platform.

Pimoroni is a new pitch. The financials or more specifically balance sheet is wrong.

Filed accounts to YE June 2014 show retained profits at £191,760 and paid up share capital of £15,370. According to Crowdcube's projected 2014/15 accounts (YE June 2015) net profit was £94,443. No dividends were paid out so this money is added to retained profits leaving it at £286,203. According to these Crowdcube 'accounts' no equity investment was made for the year so paid up share capital should be the same as 2014. However the retained earnings given are £267,290 and the paid in share capital has gone up to £52,870 or an additional £37,500. This addition is not accounted for anywhere.

That aside, take care with the fact that the profits for 2015 appear to be below the ones for 2014, which is not mentioned in the pitch of course. The stock holding YE 2014 was £112k but had gone up to £205k in Crowdcube's accounts for YE 2015 - although as we all now this could easily be an error on their part. Stock maybe a problem as in their first year of trading, they had only £12k of stock at YE but had managed a £87k profit. The build up of old stock after 2012 maybe an issue if you consider the large number of lines they carry.

Poor information does make it quite difficult to make any sort of considered judgement.  

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