Cost of alleged fraud at Dr Quirkey’s Good Time Emporium increases to €2.56m
The famous Dublin-based business is owned by Rosanna Davison's father-in-law Richard Quirke
The cost of the alleged fraud uncovered by directors at the firm that operates arcade and casino business, Dr Quirkey’s Good Time Emporium has increased to €2.56m.
This follows new accounts showing that Dublin Pool and Juke Box Ltd was the victim in 2020 of a further alleged fraud of €543,758.
The alleged fraud of €543,758 in 2020 is in addition to the directors calculating the alleged fraud perpetrated on the firm from 2019 and 2018 at a combined €2.026m.
The long established Dublin based business is owned by 75 year old businessman and director, Richard Quirke who is Rosanna Davison’s father in law.
The new 2020 accounts show that the €543,758 alleged fraud perpetrated on the firm in 2020 was made up of €427,387 in misappropriated cash and €116,371 in misappropriated bank payments.
The alleged 2020 fraud now brings the misappropriated cash total to €2.22m for 2020, 2019 and 2018 and the alleged fraud from the misappropriated bank payments to €342,764 over the three years.
After the alleged fraud on the firm was discovered by directors in December 2020, the firm appointed external financial consultants to carry out a thorough and comprehensive forensic investigation into the company’s systems and processes.
The directors state that “this led to the identification of unpaid taxation and interest liabilities which have been fully accrued in the company's accounts”.
The new accounts show that a further €495,355 appears under the heading of ‘interest on overdue tax’ and this brings to a total of €946,952 paid out in interest on overdue tax across 2020, 2019 and 2018.
Auditor for the firm, Colm Malone on behalf of Clonshaugh Business Park based Rush Malone and Co has qualified his opinion concerning the financial statements over the alleged misappropriated cash 2020 total of €427,387.
Mr Malone said that "with respect to amounts considered to have been misappropriated of €427,387 the information available was limited to determine the exact nature of the misappropriation".
Mr Malone states: “During the year, the company did not undertake regular cash counts and did not have an adequate system of recording all cash movements."
He added: “Owing to the nature of the company’s records, we were unable to obtain sufficient appropriate audit evidence regarding all cash movements during the period by using other audit procedures."
The Dr Quirkey's business on Dublin's O'Connell Street shut down in Spring 2020 and did not re-open until December 2021 due to Covid-19 lockdown measures.
This contributed to revenues declining by 4.75pc from €10.06m to €9.58m in the 12 months to the end of June 2020.
The €543,758 cost of the alleged fraud and €495,355 arising from interest on overdue taxes in 2020 contributed to pre-tax losses increasing by 27pc at the company to €1.61m for fiscal 2020.
The firm's accumulated profits stood at €24.45m with cash funds of €3.93m.
The newly filed 2020 accounts were signed off on the same day in March of this year as the 2019 accounts that were lodged last week which first revealed the alleged fraud.
In response to the alleged fraud, the directors state that "the company has implemented an extensive and wide ranging programme of governance and operational improvements at all levels within the organisation”.
These include new manual and electronic systems to manage cash handling in the business; new security measures around cash handling and cash collection and new management control systems.
Other improvements include new stringent recruitment processes and enhanced training programmes for employees in all roles and at all levels within the company and new employment and management appointments in key areas such as human resources, accounts and operations.
The directors state improvements also include new directors being appointed to the board and on February 4th of this year, Debbie Lawrence, Andrew Quirke and Austin Kenny were appointed to the board.
They join Richard Quirke and Anne Quirke on the board.
The 2020 accounts also repeat under the heading of ‘contingent liabilities’, a note states that the company “is currently the subject of a Revenue investigation, the outcome of which is uncertain at present”.
The note states that “the directors have provided for additional liabilities and interest in the financial statements but have not provided for potential penalties which may arise”.
The 2020 loss also takes account of non-cash depreciation costs of €1.35m, the loss of €629,653 on the sale of a tangible fixed asset offset by a €375,000 gain on the value of an investment property.
Numbers employed by the business remained at 86 and staff costs increased to €6.18m.
Pay to directors remained at €213,000 while the amount owed by the business to Mr Quirke reduced from €528,794 to €112,839.
With the lifting of Covid-19 restrictions, the directors state that they "are confident that the business will fully recover and result in strong liquidity.”
Dr Quirkey’s Good Time Emporium has been contacted for comment.
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