Management shake up looming at PAP following growing financial problems

During a supervisory board meeting of the Polish Press Agency (PAP), it was announced that the company is in a very poor financial condition. It is in danger of losing its financial liquidity. After the third quarter, the Agency recorded net losses of zl. 700,000. It was revealed that Bank Pekao has refused to grant PAP a loan for the construction of its new headquarters. One major problem that has come to light is that PAP signed a deal with Telbank in 1998 for use of a PAP satellite transmission antenna, for which Telbank was supposed to pay PAP a monthly fee of zl. 40,000. When PAP moved out of the office in early 2001, Telbank stopped paying the monthly fee. However, the problem was that the Agency continued to issue invoices to Telbank and even though they were not paid, entered them as revenues in their income statements until the end of 2001. According to market analysts, all this may trigger a change in the management board, which is still mainly occupied by people appointed by the Solidarity Election Action. (Puls Biznesu, p. 4) A.K.