The Broker Network was forced to take a 96% write-down on its investment in IT outfit, Redbox Systems.

The Broker Network paid £300,000 for Redbox, the owner of online trading exchange Covermaker, only to write it down to a value of £10,000 on the advice of its accountants, Pricewater-houseCoopers.

The Broker Network managing director Grant Ellis said the decision to write down the value of the investment delayed the accounts.

It now faces a penalty fee of £250 for failing to file them in time to Companies' House.

Ellis said its accounts would be filed within "six to eight weeks".

The right to distribute Covermaker now lies with Software Solutions Partners (SSP), but Ellis said he still hoped Redbox would contribute to the business.

"We're reasonably comfortable it will produce a revenue stream," he said, "but the return will probably come later and over a longer period than originally thought."

The write-down would cut The Broker Network's profits to "tens of thousands" of pounds as opposed to "hundreds of thousands", Ellis said.