POL00107884 - Regina v Khayyam Ishaq, Expert Report of Beverley Ibbotson - Joint Statement of Beverley Ibbotson & Gareth Jenkins with manuscript comments from third party.
PK
Accountants &
business advisers
Regina -v- Khayyam Ishaq
Expert Report of Beverley
Ibbotson
[& Joint Statement of Beverley
Ibbotson & Gareth Jenkins]'
26 February 2013
Prepared by: Beverley Ibbotson
Forensic Accounting Director
PKF (UK) LLP
3° Floor
10 South Parade
Leeds
LS1 5QS
Position and firm:
* Following joint statement discussions of 25" & 26" February 2013, Mr
Jenkins’ comments are shown throughout the report in bold italics. In all other
respects Ms Ibbotson’s report is agreed between the parties.
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Regina -v- Khayyam Isha: PRE
Contents
1 Introduction...
2 Background....
3 Findings..
4 Summary and conclusions ...
5 Expert's Declaration
Appendices
A Curriculum Vitae
B__List of documents relied upon
C Copies of the Prosecution Exhibits $8/3 to SB/10; SB/21 & SB/23
D1 Reversals of sales, from Horizon data, for November 2010, by date order, user identity order
and in detail showing product descriptions
D2 Reversals of sales, from Horizon data, for December 2010, by date order, user identity order
and in detail showing product descriptions
D3__ Reversals of sales, from Horizon data, for January 2011, by date order, user identity order and
in detail showing product descriptions
D4 Reversals of sales, from Horizon dala, for February 2011, by date order, user identity order and
in detail showing product descriptions
£1 Sales and reversals of sheets of stamps November 2010
E2 Sales and reversals of sheets of stamps December 2010
E3__ Sales and reversals of sheets of stamps January 2011
F1 Sheet stamp purchases/stock inwards 14 October 2010 to 9 November 2010
F2 Sheet stamp purchases/stock inwards 10 November 2010 to 10 December 2010
F3 Sheet stamp purchases/stock inwards 11 December 2010 to 10 January 2011
F4 — Sheet stamp purchases/stock inwards 11 January 2011 to 9 February 2011
G1 Comparison of exhibits SB/3, SB/4 & SB/6
G2__ Stock roll forward of product codes 2463; 2464; 20274; & 20275 (sheets of stamps)
G3 Summary of reversals
Exhibits
BGI 1
BIIGJ 2
BUGJ3
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1 Introduction
The writer
11
My name is Beverley Ibbotson. I am a Chartered Accountant and a Director in PKF (UK)
LLP's forensic services practice. My experience spans audit work, fraud investigations,
reconstruction of accounts and the preparation of expert accounting evidence. Further
details of my qualifications and experience are set out at Appendix A.
Summary of the case
12
13
Mr Khayyam Ishaq (“Mr Ishaq” or the “Defendant") has been charged with a single count of
theft of £21, 168.64 from the Post Office Ltd.
Mr Ishaq has pleaded not guilty to the charge.
My instructions
14
I am instructed by Musa Patels solicitors, on behalf of Mr Ishaq, to prepare an expert
accountancy report. My instructions are as follows:
a) to consider whether the factual contentions raised by the Prosecution are correct;
b) whether there has been any double or multiple accounting of monies and/or stock;
c) prepare a report considering:
i) the Prosecution material and defence material (including the Defendant's
instructions)
ii) the full business documents (if any supplied) by the Defendant
ili) the Defendant's full and comprehensive signed instructions as to all issues
raised by the Prosecutor's case summary
d) the report to establish a full and documented audit trail in respect of all issues of
relevance to the case and the prosecution assertions.
e) the report to comment upon the methodology used by the Prosecution; the findings
and conclusion of the Prosecution, the interpretation and significance of those findings
and alternative interpretation(s) to be placed on those findings
Other matters
1.5
1.6
I have not, unless specified, attempted to obtain independent verification of the financial
information referred to in this report.
This report should not be construed as expressing any opinions on matters of law.
26 February 2013 Introduction 1
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1.8
1,10
444
1.12
My report is confined to a consideration of matters of accountancy expertise. Where it is
necessary to refer to matters outside my experience, I draw attention to such matters but
offer no opinion on them.
This report has been prepared for the Court solely for the purpose set out above. It may not
be used for any other purpose, reproduced or disclosed to any other party in whole or in part
without my prior written consent.
I have consulted with and have been assisted by PKF personnel in the preparation of this
report. I have supervised such work carried out on my behalf and I confirm that the views
and opinions expressed herein are my own.
I understand that my duty in providing this report is to the Court and this report is addressed
to the Court and not to those instructing me.
In accordance with Part 33 of the Criminal Procedure Rules and the Practice Direction
supplementing it, I set out my expert's declaration at the conclusion of the body of this report.
I reserve the right to amend my conclusions if further information is made available to me.
26 February 2013 Introduction 2
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21
2.2
2.3
Background
The Defendant was the sub postmaster at Birkenshaw Post Office. On 8 February 2011 the
Network Support Field Team (“NSFT") visited the Birkenshaw Post Office to undertake a
check of the cash. A count took place and the Prosecution say a shortage of £536 was
noted. A “balance snapshot exercise” was then undertaken in which the shortfall was noted
as being £2,569.19 (Exhibit SB/3).
This £2,569.19 is the cumulative set of discrepancies from the balance period (balance
periods are determined by the sub postmaster, and are the typically weekly or more
often occasions where the books and records of the business are balanced and
checked) Any discrepancies not adjusted for and cleared (by making good cash or
stock losses, at each balance period) are accumulated and carried forward to the
month-end trading period (where the monthly accounting takes place and the branch
makes its financial returns)
The discrepancy of £2,569.19 comprised mainly cash but also some stamps and
currency.
BI & GJ joint exhibits 1° and 2° show how the balance is made up.
GJ wishes to point out that there seem to be cash discrepancies every balance period
which are generally for in excess of £1,000. GJ also notes that stamp and currency
discrepancies tend to be less than £20, with a maximum expected discrepancy of £112
for stamps. BI agrees and both BI/GJ add that some of the discrepancies show cash
surpluses.
A “Tier 2°" audit was subsequently carried out which revealed, say the Crown, a shortage of
£21,168.64, Mr Ishaq was suspended at 12.45pm on 8 February 2011.
A repeat balance snapshot exercise was carried out on 11 February 2011, 3 days after the
Defendant had been suspended, at which time the shortfall was identified as being
£21,213.79 (Exhibit SB/5).
GJ agrees that these exhibits are clearly different but is unable to explain the
differences at this point. GJ points out, however, that the difference is only £45.15.
This term is not defined by the Prosecution in the Exhibits or witness statements but is understood to refer to a print
out from the computerised system, at a particular time “snapshot” of the balances of stock and cash held based on
previously agreed records and trading since the last branch trading statement.
This Exhibit has been prepared jointly by BIGJ by extracting all discrepancies from the Horizon data (mode 17) to
show positive and negative discrepancies.
This Exhibit has been prepared jointly by BI/GJ by extracting all discrepancies from the Horizon data (mode 17) to
show positive and negative discrepancies and by then adding the sale value of the transactions carried out by
KISO01 (totalling £2,569.19) and by both KISO01 and OWAO! (totalling £21,181.54).
This term is similarly not defined but is understood to refer to a comprehensive audit and full stock and
cashicheques count for the branch.
26 February 2013. Background 3
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25
26
27
An internal Post Office email from Mr Dennis Watson (Exhibit DW/1), dated 11 February
2011 states that the shortage identified by the audit was made up of a positive discrepancy
in stock of £12.90 and a negative discrepancy “per office snapshot” of £21,181.54, equating
to a net difference of £21,168.64 (£21,181.54 - £12.90). No further explanation has been
provided as to how this total has been arrived at, or why the sum differs from that stated at
Exhibits SB/3 and SB/5.
GJ has clarified these exhibits and wishes to explain that SB/3 is the Balance
Snapshot at the start of the audit. It does not therefore include the value of the
missing stock.
Following the stock take, adjustments were made (SB/4) that effectively converted
missing (and excess) stock into cash equivalents. It is at this point the figure
increases significantly.
GJ’s analysis shows that there were other adjustments not included in SB/4.
However, SB/4 does cover the most significant ones (i.e. sheets of stamps - see later
comments).
BI & GJ now jointly produce exhibit BI/GJ 2 which shows in detail on a line by line
basis how the value of £21,181.54 has been derived from the Horizon data.
The Post Office computer system is known as Horizon. in the Prosecution's case summary it
is stated that there has been an investigation (by the Post Office) into reversals of sales of
large quantities of stamps at the Birkenshaw Post Office.
The Prosecution assert that Mr Ishaq inflated the stock figures at the branch to cover the
cash discrepancy and that he falsified the branch accounts having stolen funds which
belonged to the Post Office Ltd.
The Prosecution allege that based upon Horizon data for the period 2 November 2010 to 31
January 2011, the following large quantities of stocks of stamps were sold and then the sales
reversed:
Exhibit SB/21 Sales Reversals Difference
Sheets of 50 x 1" class large stamps 465.00 4,200.00 4,125.00
Sheets of 50 x2" class large stamps 53550 4,080.00 3,844.50
Sheets of 100 self adhesive first lass stamps 1271.00 6,068.00 4,797.00
Sheets of 100 self adhesive second class stamps 864.00 3,200.00 2,336.00
"2,836.50 17,638.00 14,802.50
Differences are explained in the witness statement of Stephen Bradshaw 19 June 2012, but are the net between
sales made and sales reversed.
26 February 2013. Background 4
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2.8 The Prosecution allege that other than on 24 November 2010, all of the above reversal
transactions were conducted by user KIS001 or KIS002, which they state was Mr Ishaq's
user name on the Horizon computer system. Exhibit S8/21 (attached within Appendix C for
ease of reference), shows a summary of the reversals made, including the dates and
computer user identities.
4 ‘Both BI & GJ are agreed as to the accuracy of the extraction from Horizon data of the
material used to compile exhibit SB/21. ~> Sy yo ox pars are by N, ie be
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29 The 24 November 2010 transactions are stated as having been carried out by user identity .
UL1001, which is stated as belonging to Mr Umair Liagat. wor of evenly
2.10 _ Inhis witness statement dated 24 June 2011, Mr Liaqat states: a Wot Co “
actu «
a) He has worked at Birkenshaw Post Office from 2009 (in the shop) and then from August
2010 in the Post Office counters, serving customers;
b) He works Monday to Friday 9,00am to 5.30am with no break for lunch;
c) He worked on counter position 1;
d) He had his own login and password, both of which were given to him by the post master
(ie. the Defendant);
e) He advised the postmaster of his password — i.e. he shared it / made it known.
f) He participated in the counting of stocks of coins and stamp books, but only the post
master counted the safe contents;
g) He was never present when the balancing figures were reached at the end of each day;
h) He was never made aware of any discrepancies.
26 February 2013. Background 5
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2.11 The witness statement of Kathleen Smith, a Network Field Support Advisor ("FSA"), with the
Post Office Ltd, dated 8 May 2012, states that she attended Birkenshaw Post Office on 8
February 2011 (with fellow FSA Mr Dennis Watson) and carried out an audit, which she
states revealed “major discrepancies in the stock of 100 x first and second class stamps self
adhesive sheets and the 50 x first and second class stamps self adhesive sheets”.
212 Ms Smith states that the audit “identified overail deficit in the accounts of £21,168.64".
2.13 The Prosecution allege that the Defendant inflated the stock figures for stamps, in order to
balance the cash deficiencies which had arisen. The Prosecution thereby infer that the cash
shortages were as a result of theft on the part of the Mr Ishaq of monies belonging to the
Post Office Ltd.
26 February 2013 Background 6
Regina
yam Ishaq
3
3.41
3.2
Findings
I have been provided with exhibits DW/1, SB/1 to SB/10, SB/13 to SB16, SB/19 to SB21 and
SB/23. I have attached copies of the Exhibits marked as SB at Appendix C for ease of
reference. I have also been provided with electronic copies of Horizon data for the period 9
September 2010 9 February 2011
I have reviewed and reanalysed the exhibited material and have noted the following:
Stock per “snapshot” and stock adjustments (SB/3 and
SB/4)
3.3
3.4
3.5
3.6
37
Exhibit SB/3 is the “snapshot figures” taken from the Horizon system at 08.50 on 8 February
2011, when Mr Watson arrived to carry out the audit. The snapshot comprises a printout of
stock on hand at the branch by type and by volume according to Horizon, for example the
first item reads Euro TChq — Euro travellers’ cheques — and the number according to the
computerised records shows stock levels of 300. At the side of this figure is a hand written
annotation of either a mark to indicate agreement (a tick) or the actual number or difference
if there is one.
Instructing solicitors have confirmed that the photocopy provided to me of SB/3 is as it was
served and that the hand written annotations were already on the exhibit. As such I have
assumed that the handwriting is that of the branch auditor(s), who undertook the stock count
on 8 February 2011 having printed out the “snapshot.
GJ agrees
On Exhibit SB/3 the hand written figures for stock are inconsistently written. For example for
stocks of stamp cards the actual stock is written in the second column of hand written figures.
as 298 and the difference from Horizon of 1 (Horizon stock being 299) is written in the first
column. On the next “discrepancy” down the list the first column reads “-1200" for “1 class
stmp” with no difference attributed, yet Horizon shows the stock should be 1499.
This may simply be a recording error as on SB/4 the adjustment to stock has been written as
299 1* class stamps @ 0.41 each - £122.59. The correct layout of a stock taking record
should be consistent between items, to avoid potential confusion and errors in recording.
GJ agrees
On the next item on the list “7 class large” the Horizon stock is 920 with a figure of "-9" next
to it and then “977” thereafter. This suggests the actual stock was 911 a difference of 9
items; however the presentation is different to the item immediately above.
26 February 2013 Findings 7
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3.8
3.9
3.10
Stock per Tier2 au
A number of items (MVL discs, bus day rover adv, air letter single, special 97p) are recorded
in a different style from paragraphs 3.5 and 0 above in that the actual stock counted is not
recorded just the positive difference (i.e. that more stock is held than the Horizon system
shows). Again, it is usual and best practice when stock taking to record all items counted in
a consistent manner to avoid inaccuracies.
Notwithstanding the recording style, I note that these stock lines where more stock is held
than there should have been have not been adjusted for on SB/4 — thereby overstating the
stock difference figure (these items should be valued and credit given).
GJ points out that by looking at the logs of transactions from the Horizon data there
were a number of adjustments made by the auditors but that SB/4 is the only exhibit
to show the adjustments made.
BI & GJ jointly exhibit B/GJ 3 which shows the totality of the audit adjustments and
shows on the highlighted transactions that the cumulative effect of the positive
discrepancies (surpluses) have in fact been accounted for.
A similar item (postal orders) is also recorded again in a different style from paragraphs 3.5
and 0 above in that the actual stock counted is not recorded, just the negative difference (i.e.
thal less stock is held than the Horizon system shows). Again, it is usual and best practice
when stock taking to record all items counted in a consistent manner to reduce inaccuracies.
GJ agrees that the presentation is messy, but questions whether this is relevant. GJ
notes that postal orders have zero value even when sold and so may have been
handled differently for that reason.
stock check and subsequent stock
adjustments (SB/6 and SB/4)
3.11
3.12
I have reviewed the stock record served as Exhibit SB/6, which is signed by both Mr Dennis
Watson and Ms Kath Smith who carried out the full audit on 8 February 2011.
Ihave summarised, at Appendix G1, the stock figures on a stock line by line basis, between
the stock on hand according to the snapshot (Exhibit SB/3) and the hand written stock count
under taken during the Tier 2 audit, the results of which are shown on Exhibit SB/6.
For ease of reference I have colour coded various apparent anomalies and make the
following observations:
26 February 2013 Findings 8
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3.14
3.15
3.16
3.17
A number of stock lines have not been included in the Tier 2 stock check. These are shaded
beige on Appendix G1, No explanation has been provided in the Prosecution witness
statements of Mr Watson & Ms Smith to explain why they did not carry out a complete stock
count during the course of what is described as a full audit at the branch.
GJ is unable to address this point.
Furthermore, despite not undertaking a physical stock count (per SB/6), adjustments have
been made on SB/4 for apparent stock discrepancies. These items are shaded in pink at
Appendix G1.
GJ is unable to address this point, but considers the values associated with these
items to be trivial.
As previously stated (paragraph 3.9 above) where physical stock on hand exceeded that
shown on the Horizon records, adjustments have not been made at Exhibit SB/6 to reflect
the positive discrepancies. These are shown in yellow at Appendix G1.
GJ is unable to address this point, but again considers the values associated with
these items to be trivial.
At Appendix G1, I have shown in red the negative differences (i.e. stock shortages) between
the physical stock quantities at the branch on 8 February 2011, when compared to stock
quantities according to the Horizon records. The most significant discrepancies (in terms of
number of items and value) are in stocks of 1" class stamps, and sheets of stamps (shaded
in green at Appendix G1). ‘These discrepancies are considered in more detail, from
paragraphs 3.18 onwards below.
GJ & BI refer back to paragraph 3.9 above and their agreed comments / exhibits
thereon.
Horizon data (SB/7 to SB/10)
3.18
Exhibits SB/7 to SB/10 consists of copies of the branch trading statements, for Birkenshaw
Post Office, for the following periods:
Poriod Exhibit
15/09/10 to 13/10/10 SBT
13/10/10 to 17/11/10 SBB
17/1/10 to 15/12/10 sBIo
15/12/10 to 12/01/11 SB/10
26 February 2013 Findings 9
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3.19 I have summarised, at Appendix G2, the stock figures according to the branch trading
statements as exhibited above, for the four trading periods immediately prior to 8 February
2011. I have also summarised the stock figures as shown on 8 February 2011 from the
snapshot (Exhibit SB/6) and the stock on 11 February 2011 when the branch hand over took
place (Exhibit SB/5).
3.20 Using the starting stock positions on 13 October 2010 and following only the main four stock
lines where the apparent discrepancies were noted at the branch audit (shown in green at
Appendix G1"), I have carried out an analysis of the stock movements, which includes the
four trading periods above and a further period from 13 January 2011 up to and including the
branch audit visit.
3.21 I have limited my analysis to the following four stock lines, as these concern the largest
volume of alleged discrepancies and also allow a direct comparison of my results with the
analysis carried out by the Prosecution, in their Exhibit SB/23.
3.22 I have obtained the data for sales of sheet stamps from the Horizon spread sheets provided
to me and my summary analysis is set out for each separate period at Appendix E1.
3.23 I have obtained the data for purchases of sheet stamps from the Horizon spread sheets
provided to me and my summary analysis is set out for each separate period at Appendix
FA.
Self adhesive 1" class stamps in sheets of 100 (product code 2463); self adhesive 2” class stamps in sheets of 100
(product code 2464); sheets of 50 x 1" class large (product code 20274); & sheets of 50 x 2” class large (product
code 20278)
26 February 2013 Findings 10
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Khayyam Ishaq
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3.24
In doing so, I have taken account of sales and purchases of sheets of stamps only and
show, at Appendix G2, what the stock holdings should have been as at 8 February 2011,
which may be summarised as follows:
Stock type Sheets of Sheets of Sheets of
Self 50 x2" Self Sheets of
adhesive class adhesive 1" 50x 1"
2” class large class class large
stamps stamps —_— stamps stamps
Product code 2464 20275 2463 20274
Period 1 (13.10.10)
‘Opening stock 137 110 82 99
Purchases 100 30 80 Nil
Sales (18) a) (19) 6)
Closing stock 222 139 152 93
Closing stock per Branch Trading 252 139 152 93
Statement
Unexplained difference 30 nil nil nil
Period 2 (17.11.10)
Opening stock 252 139 152 93
Purchases Nil Nil Nil Nil
Sales a) (20) ® (ty
Closing stock 244 119 143 92
Closing stock per Branch Trading 290 279 art 122
Statement
Unexplained difference 49 160 128 30
Period 3 (15.12.10)
Opening stock 290 279 an 122
Purchases 100 Nil Nil Nil
Sales 2) Nil @ Nit
Closing stock 388 - 122
Closing stock per Branch Trading 407 278 283 222
Statement
Unexplained difference 19 a) 19 100
Period 4 (12.01.11)
‘Opening stock 407 278 283 222
Purchases Nil Nil Nil Nit
Sales (115) (162) (159) (131)
Closing stock 292 116 126 Ea
Closing stock per “Snapshot” 395 27 274 224
Unexplained difference 103 (161) 150 430
26 February 2013 Findings 11
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Khayyam (shaq PKF
3.25 As the analysis above and at Appendix G2 demonstrates, the stock movements according to
Horizon data (opening stock + purchases - sales = closing stock), produces stock levels, for
sheet stamps which for all periods except period 1, are significantly below the stock levels
declared on the branch trading statement (see the figures highlighted at paragraph 3.24 as
“unexplained difference”).
BI & GJ have discussed this methodology and BI has clarified that in her analysis she
has ignored any reversals and sought to extrapolate only absolute stock movements
(purchases and sales) from the electronic data. GJ and BI agree that on such a roll
forward of stock figures there are discrepancies of stock items as at 8 February 2011
which are accounted for by the reversals made.
3.26 The closing balances produced by the Horizon data as shown in yellow at Appendix G2,
closely correlate with the actual stock levels as counted during both the Tier2 audit and on
hand over of the branch on 11 February 2011. The stock levels are however significantly
lower than those shown on the snapshot (Exhibit SB/3)
3.27 It is the Crown's case that in order to balance the trading statements, the Defendant carried
out false entries to inflate the stock levels above what they in reality were, thereby disguising
the fact that the corresponding cash balances had been misappropriated. In other word
replacing the missing cash asset in the balance sheet (of the trading statements) with a
stock asset.
BI & GJ are agreed that the Horizon data from the logs of the transactions show that
stock reversals have a corresponding cash entry associated with each transaction.
Bi has requested but has not been provided with any exhibits which support or show
the cash which was counted during the audit on 8 February 2013. GJ has provided BI
with exhibit PS32, however this does not show a cash c~""* ~ ~1%4 “4
8 February 2011. > ' m vncleay Wut AL
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3.28 “As stated at paragraph 2.7 above, the Prosecution allege
“achieved by reversing out sales of stamps over and above '
allege that other than on 24 November 2010, all of the reve
by user KISO01 or KIS002, which they state was Mr Ish
computer system.
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26 February 2013 uae
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3.25 As the analysis above and at Appendix G2 demonstrates, the stock movements according to
Horizon data (opening stock + purchases - sales = closing stock), produces stock levels, for
sheet stamps which for all periods except period 1, are significantly below the stock levels
declared on the branch trading statement (see the figures highlighted at paragraph 3.24 as
“unexplained difference’).
BI & GJ have discussed this methodology and BI has clarified that in her analysis she
has ignored any reversals and sought to extrapolate only absolute stock movements
(purchases and sales) from the electronic data. GJ and BI agree that on such a roll
forward of stock figures there are discrepancies of stock items as at 8 February 2011
which are accounted for by the reversals made.
3.26 The closing balances produced by the Horizon data as shown in yellow at Appendix G2,
closely correlate with the actual stock levels as counted during both the Tier2 audit and on
hand over of the branch on 11 February 2011. The stock levels are however significantly
lower than those shown on the snapshot (Exhibit SB/3).
3.27 _Itis the Crown's case that in order to balance the trading statements, the Defendant carried
out false entries to inflate the stock levels above what they in reality were, thereby disguising
the fact that the corresponding cash balances had been misappropriated. In other word
replacing the missing cash asset in the balance sheet (of the trading statements) with a
stock asset.
BI & GJ are agreed that the Horizon data from the logs of the transactions show that
stock reversals have a corresponding cash entry associated with each transaction.
Bi has requested but has not been provided with any exhibits which support or show
the cash which was counted during the audit on 8 February 2013. GJ has provided BI
with exhibit PS32, however this does not show a cash count or audit of cash levels on
8 February 2011. > Imunclas who b WROM, § bola Are AS
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3.28 “As stated at paragraph 2.7 above, the Prosecution allege that the stock differentials were
achieved by reversing out sales of stamps over and above those sold. The Prosecution also
allege that other than on 24 November 2010, all of the reversal transactions were conducted
/ by user KIS001 or KIS002, which they state was Mr Ishaq’s user name on the Horizon
/ computer system.
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26 February 2013 EAT 7 Findings 12 aes
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3.29 I have summarised, at Appendix G3, all reversals between 9 September 2010 (start of
branch trading statement period 1) and 8 February 2011, which I have further sub
categorised by user ID and by product code, As my analysis shows of the 248 reversal over
the period, 14 were made by Mr Dennis Watson, following the audit on 8 February 2011, 173
were carried out under the user names associated with Mr Ishaq and 61 reversals were
carried under the user name associated with Mr Liaqat.
GJ agrees that there are 248 items and with the split on o total basis as above. GJ
points out that if only 4 product lines are analysed (as SB/21) then other than one
transaction all were carried out by under name K/001 or KIS002. BI agrees.
26 February 2013. 13
Regina
yyam Ishaq PKF
44
42
43
44
45
46
Summary and conclusions
I have been instructed to:
Consider whether the factual contentions raised by the Prosecution are correct. I have noted
a number of apparent discrepancies in the stock take which I have commented upon at
paragraphs 3.5 to 3.10 above.
State whether there has been any double or multiple accounting of monies and/or stock. My
analysis of the stock movements suggests that the Horizon data, for the four stock lines
concentrated upon was accurate, and that the figures in the balance snapshot, taken on 8
February 2011, was not then able to be substantiated by the subsequent audit. The Crown
state this difference is due to inflation of stock on the snapshot'to balance cash which had
been misappropriated.
Prepare a report considering
a) the Prosecution material and defence material (including the Defendant's instructions).
My findings in this respect are set out at Section 3 above.
b) the full business documents (if any supplied) by the Defendant. I have not been
provided with any such documents, and as such can make no further comment in this
respect.
c) the Defendant's full and comprehensive signed instructions as to all issues raised by
the Prosecutor's case summary. I have not been provided with any such documents,
and as such can make no further comment in this respect.
I am instructed to prepare a report establishing a full and documented audit trail in respect of
all issues of relevance to the case and the prosecution assertions. In this respect see my
findings at Section 3 above.
My report was to comment upon the methodology used by the Prosecution; the findings and
conclusion of the Prosecution, the interpretation and significance of those findings and
alternative interpretation(s) to be placed on those findings. In this respect see my findings at
Section 3 above.
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51
5.2
5.3
54
5.5
5.6
58
5.9
5.14
Expert’s Declaration
I, Beverley Ibbotson, declare that:
I understand that my duty is to help the Court to achieve the overriding objective by giving
independent assistance by way of objective, unbiased opinion on matters within my
expertise, both in preparing reports and giving oral evidence. I understand that this duty
overrides any obligation to the party by whom I am engaged or the person who has paid or is
liable to pay me. I confirm that I have complied with and will continue to comply with that
duty.
I confirm that I have not entered into any arrangement where the amount or payment of my
fees is in any way dependent on the outcome of the case.
I know of no conflict of interest of any kind, other than any which I have disclosed in my
report.
I do not consider that any interest which I have disclosed affects my suitability as an expert
witness on any issues on which I have given evidence.
I will advise the party by whom I am instructed if, between the date of my report and the trial,
there are any changes in circumstances which affect my answers to points 5.3 and 5.4
above
I have shown the sources of all information I have used. I enclose as Appendix B to my
report a schedule of documents on which I have relied.
I have exercised reasonable care and skill in order to be accurate and compiete in preparing
this report.
I have endeavoured to include in my report those matters of which I have knowledge or of
which I have been made aware that might adversely affect the validity of my opinion. I have
clearly stated any qualifications to my opinion.
I have not without forming an independent view included or excluded anything which has
been suggested to me by others, including my instructing lawyers. In carrying out my
instructions I have been assisted by colleagues in PKF. It would not have been practical or
efficient to carry out all the detailed work involved without assistance. I have reviewed and
discussed with them the work which they have performed under my direction in accordance
with the quality control standards imposed by my firm. For the purposes of this report, I refer
to all of PKF's work as if performed by myself.
I will notify those instructing me immediately and confirm in writing if for any reason my
existing report requires any correction or qualification.
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b)
c)
d)
e)
9)
I understand that
my report, subject to any corrections before swearing as to its correctness, will form the
evidence to be given under oath or affirmation;
the Court may at any stage direct a discussion to take place between experts;
the Court may direct that, following a discussion between the experts, a statement should be
prepared showing those issues which are agreed and those issues which are not agreed,
together with a summary of the reasons for disagreeing;
I may be required to attend Court to be cross-examined on my report by a cross-examiner
assisted by an expert;
I am likely to be the subject of public adverse criticism by the judge if the Court concludes
that I have not taken reasonable care in trying to meet the standards set out above.
I have read Part 33 of the Criminal Procedure Rules and I have complied with its
requirements.
I confirm that I have acted in accordance with the Code of Practice for Experts.
Statement of truth
5.13
I confirm that the contents of this report are true to the best of my knowledge and belief and
that I make this report knowing that, if it is tendered in evidence, I would be liable to
prosecution if I have wilfully stated anything which I know to be false or that I do not believe
to be true.
Signed .... Date 26 February 2013...
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Appendix A
Curriculum vitae of Beverley Ibbotson
Position Director in PKF Forensic Services.
Background
‘Over 20 years’ accountancy experience, the last 16 of which has been spent solely working as a
specialist forensic accountant. A Fellow of the Institute of Chartered Accountants in England and
Wales, having a breadth of experience in criminal defence, fraud investigation, expert witness, and
advisory work
Professional Associations
Fellow of the Institute of Chartered Accountants in England and Wales
Education
LLB (Hons) Leeds University 1986 to 1989
Professional History
Dates Company Position
2011 to date PKF Director, Forensic Services Department
2008 - 2011 Bartfields Business Services Senior Manager ~ Forensic Services
2002 ~ 2008 Forth Associates Senior Associate — Forensic Services
1998 — 2000 OTE Senior Manager — Forensic Services
1996 - 1998 RSM Tenon Manager — Forensic Services
1995 - 1996 Haines Watts Assistant - Forensic Services
1990 - 1995 Deloitte Training Contract & Supervisor Audit &
Assurance
Experience
All aspects of forensic accountancy including obtaining discovery of documents, analysis and
preparation of reports to assist the Court in personal, commercial and criminal cases.
Areas of experience include:
Matrimonial disputes
Business interruption claims
Insurance claims
Fraud investigations
Criminal investigations
POCA proceedings
Professional negligence
Personal injury
Fatal accident
As well as attending conferences with Counsel and discussions with experts with a view to preparing
Joint Statements as directed by the Courts.
26 February 2013 Appendix A
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Appendix B
List of documents relied upon
. Witness statements of Dennis Watson, Kathleen Smith
. Copies of exhibits $B3 to SB10 and SB/21 and SB/23
. Excel spread sheets of Horizon data, for Birkenshaw Post Office, from September 2010 to 8
February 2011
26 February 2013 Appendix B