Sims Metal to take hit amid fraud probe
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February 15 2013, 10:45AM
The two UK businesses at the heart of Sims' investigation recycle electronics, including computers and televisions. Sims' biggest recycling business is in metals.
Sims said investigations by a special internal committee had revealed that inventory had been overstated at Newport and Long Marston.
"The committee's investigations have revealed that the primary root cause for breakdowns in the company's control environment can be attributed to the failure to adequately supervise operations (including inventories), responsibly safeguard assets, and failure to maintain adequate controls over financial reporting relating to inventory," Sims said in a statement.
Internal audits and additional control measures put in place by the company also failed to identify problems including excessive levels of inventories and IT issues.
Sims said it would immediately introduce its standard set of controls over inventories and integrate IT systems to improve its operations in the UK.
The committee carrying out the investigation would also now turn its attention to decisions made by staff and management connected to the problems.