Quote ="Staffs FC"If you buy a company you do something called "Due diligence". That throws up issues both current and potential future problems. Didn't the SMC's owners do this ? Why not ?'"
I am fully aware of Due Diligence , thank you very much . Any Due Diligence could still throw up surprises once a takeover has happened and I dare say whoever they used would have been a highly professional auditing firm . The repair costs increase may well have been expected to kick in later in the life of the building and so the SMC would have the choice to begin charging upfront to build up reserves ready for this or it may have taken the policy of commencing extra charges when the extra expenses occurred .
It looks like the revenues could be fixed for a number of years and costs could well be going up and so it is easy to get into a loss situation then .
Interestingly the potential £500k claim on the council seems to be do with missing warranties which probably means repairs still have to be done but no paperwork exists to be able claim under the warranty . Whether these were forthcoming at Due Diligence , only a few people would know this .