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Shares in energy broker Utilitywise (UTW:AIM) have fallen by 81% in value to 69.25p over the past three years amid growing concerns about its accounting policies.
Those concerns proved correct at the end of June when the company revealed it would have to refund £7.6m worth of commission payments to an energy provider.
Utilitywise gets commission from utility companies for finding new customers; its fee is based on forecast energy consumption.
The small cap has historically booked revenue in its accounts for commission payments despite the cash often not actually arriving in its bank account for several years.
It now turns out that several clients for whom it secured new energy deals are consuming far less energy than expected – thus it has to give some cash back.
Utilitywise’s largest shareholder at 28.9% is the Neil Woodford-run CF Woodford Income Focus Fund (GB00BD9X6V34).
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