Insured Group’s 2012 profit has been revised down by auditors, from $1.3 million to $234,000.

Borrowing has been revised to $4.8 million, up from $3 million recorded in unaudited accounts released last August.

Net assets have been moved down to $1.8 million from $3 million.

Insured Group MD Wayne Miller says the unaudited accounts were based on a $3 million loan from St George Bank, the company’s financier and largest creditor.

This sum was to be repaid by last September 30 but the bank has since agreed to an extension until March 31.

“The audited annual report for the year ended June 30 has recorded this liability as $4.8 million, being the actual liability at the reporting date,” Mr Miller said.

Revenue for the 2012 financial year fell to $2.9 million from $3.9 million in the previous year.

Auditor Grant Thornton has raised questions about the company continuing as a “going concern”.

It has queried the value of Insured Group’s investment in Priority One Network, which is listed as available for sale at $2.5 million.

In the report the value is based on Insured Group’s valuation, but Grant Thornton says until Priority One Network is listed on the Australian Securities Exchange, it is “unable to determine whether the recoverable amount is equal to its fair value”.

Insured Group values the goodwill of the company at $7.9 million, but Grant Thornton says this is based on budgeted future cash flows. “We have been unable to obtain sufficient appropriate audit evidence to support the figure used in the impairment assessment and therefore unable to satisfy ourselves as to the carrying value.”

Mr Miller says the company will continue to reduce its debt and plans to list on the stock exchange in the next 12 months. It also aims to raise at least $3 million during this period.