Revelations of accounting errors which resulted in an understatement of historical losses by £3.9m at London black cab maker, Manganese Bronze Holdings plc, has forced the company to delay its half-year results.

Manganese Bronze told the market today that the issues concerned 2011 and previous financial years.

It gave notice for announcement of its half-year results either on or before 24 September 2012.

The problems began with the introduction of a new integrated IT system in August 2010, intended to help manage the increasingly complex supply chain. The new system uploaded the closing general ledger balances from the previous IT system but did not properly process residual balances from the previous IT system.

'Due to a combination of system and procedural errors, a number of transactions relating to 2010 and 2011, and some residual balances from the previous system were not properly processed through the new IT system,' the company said.

This has led to the over-statement of stock and under-statement of liabilities in the financial statements of previous years.

Manganese Bronze further revealed that the cumulative effect of these errors is an estimated £3.9m understatement of historical losses which go back over several years although the work to apportion the loss between previous years is not yet complete.

In accordance with the provisions of IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, the balance sheet at 31 December 2011 and the financial results for 2011 and prior years will have to be restated.

'Trading in the first seven months of the year has been difficult and remains challenging with the group continuing to trade at a loss. As announced on 17 May 2012, sales for the first half were lower than in the comparative period in 2011 and the group currently expects to report net losses for the first half that are substantially higher than reported last year.

The group is expecting higher sales in the second half but does not know at this stage if results for the full year will be in accordance with market expectations,' the company said in a statement.

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