Fore! The Smurfits appear to have have written down the value of the K Club golf resort in Straffan by €16.2 million to €67 million. Being a canny financial family, they also apparently didn't require the help of a professional valuer to arrive at that figure. If you want a job done, do it yourself.
Accounts for 2012 have just been filed for several companies linked to the K Club. At the time of writing, figures for the main group company, Bishopscourt Investments, were not available for viewing. But accounts for one of the former K Club service management companies, Bessilton Holdings, shed some light on the resort's finances.
The accounts state that the group, of which Bessilton is part, has written down the assets, but the auditors have slapped a health warning on the move because a professional valuer was not engaged. When Bishopscourt’s accounts come through, the writedown is likely to trash its profits.
A note in the accounts states that “the directors’ valuation is not supported by a formal external valuation report . . .” but “improving property market sentiment” means the Smurfits are confident they now have the right figure.
“The directors recognise the risks associated with their valuation exercise,” the note said.
Bessilton formerly provided property management services to homeowners at the K Club, but fell out with some of them during the crash over unpaid service charges.
In a related 2011 court case, two homeowners complained that the resort had become “somewhat run down”.
Bessilton states that it is owed about €400,000 in unpaid management fees, for which it has made a provision. During 2012 the homeowners also decided to appoint a new service company, yanking Bessilton’s revenues from €383,000 to zilch in one fell swoop.
Bessilton, which is registered in Gibraltar, isn't the only one owed money.
A judgment was registered against it in April this year by Kildare County Council for €247,000. A mulligan would be nice . . .