How can £4m disappear in a black hole in the Accounts?

That’s exactly what happened at London Black Cab maker Manganese Bronze

The company blamed the accounting mistake on its new IT system, which meant losses, dating back several years, had been understated by £3.9m.

Coventry-based Manganese Bronze saw its shares fall 34% after saying it expected “substantially higher” losses for the first half of the year.

Manganese said a combination of “system and procedural errors” meant a number of transactions and balances were not transferred to the new IT system when it was introduced in August 2010.

Basically Invoices went missing during the transfer between systems.

If you are changing accounting system:

1. Choose your new software carefully and ask for references

2. Have a migration plan

3. Makesure your data is safe, secure and correct before you switch

4. Test the new system before your go live

5. If necessary parallel run the systems