Former BDO partners chased for $1.1 million in bad debts
Monday, May 21, 2012/
Former partners of the accountancy firm BDO in Sydney and Melbourne are being pursued for $1.1 million in bad debts by a professional indemnity insurance funder.
The Australian Financial Review reports that partners of the now defunct $80 million BDO New South Wales and Victoria practice received letters from lawyers of Pacific Premium Fundings claiming they had failed to make payments of $221,852, which triggered a default demand for the full $1.1 million owing.
Rival firm Grant Thornton acquired most of the accountancy firm’s assets in April, paying $50 million in order to bail out BDO NSW/VIC.
Tony Schiffmann, chairman of BDO, told SmartCompany the accountancy firm had been made aware through media articles that the former BDO practices had received letters regarding alleged litigation.
“The former BDO NSW/VIC practices, which are now part of the Grant Thornton network, were financially independent of all other firms in the Australian BDO network and, as such, the financial arrangements of the former NSW/VIC practices were also separate and we confirm that we had no first-hand knowledge of its financial arrangements,” says Schiffmann.
“It would be inappropriate for us to comment further in relation to these alleged issues.
“However, we can say that the present BDO Network in Australia is operationally and financially sound and is not subject to these issues.”