ABC Learning investigated by ASIC

Troubled childcare group ABC Learning Centres is being investigated by the Australian Securities and Investments Commission for possible breaches of its continuous disclosure obligations

Troubled childcare group ABC Learning Centres is being investigated by the Australian Securities and Investments Commission for possible breaches of its continuous disclosure obligations, The Australian Financial Review reports.

The paper says it is believed that former ABC chief executive James Black was interviewed by ASIC last week.

Meanwhile, ABC continues to struggle with auditors at Ernst & Young over the preparation of its 2007-08 accounts.

It is understood ABC has hired accounting firm KPMG to settle a dispute between its former auditors, Pitcher Partners and Ernst & Young, over how specific parts of its accounts are to be treated.

ABC says it has postponed the release of its 2008 earnings, saying they require further adjustments and are still being finalised. The company remains in a trading halt.

It is the latest in a string of troubling events for Australian’s largest childcare group. Its shares have tumbled, chief executive Eddy Groves has lost the majority of his large stake in the company, and it is now facing a shareholder class action.

This week Groves announced 1000 part-time workers would be sacked to save $26 million.

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• Playtime’s over for ABC’s Eddy Groves
• Eddy Groves’s embarrassing audit mess
• ABC Learning a lesson for regulator