Chief Pleas has extended a £300,000 loan until November to prevent the government-owned company from going into default.
Chief Pleas' Policy and Finance Committee has agreed to extend the loan facility to its wholly owned company, Isle of Sark Shipping, to avoid it going into default.
The committee met yesterday and heard that £270,000 of the loan has been used, but there has been no repayment of the capital.
The loan extension is designed to keep the company running essential services between Sark and Guernsey.
New non-exec directors have been appointed, and Chief Pleas says it has faith in them to deal with corporate concerns.
Its meeting yesterday (26 August) ended with the warning that Sark Shipping needs to address its finances, financial reporting and systems.
Chief Pleas said in a statement:
“This is a disciplined and practical decision, but no one should mistake it for satisfaction with the current position.
"Chief Pleas should not have found itself in a situation where such fundamental questions remain about the company’s finances and financial reporting.
"The short extension avoids immediate default and provides time for a revised agreement, including provision for capital repayment, to be proposed in time for Chief Pleas to consider it at the Budget meeting later this year."
Government says it will 'continue to work constructively with the Board of Isle of Sark Shipping in order to address the financial and governance issues that led to the present position.'
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