Wirecard Says Audit Finds No ‘Substantial’ Accounting Questions
Wirecard Says Audit Finds No ‘Substantial’ Accounting Questions
(Bloomberg) -- Wirecard AG said an independent audit has uncovered no substantial findings of questionable accounting methods so far, but added it isn’t yet ready to reveal the full report.
The company said KPMG didn’t find anything in all four areas of the audit that would lead to a correction of its financial statements. The firm was looking into Wirecard’s third-party partner business, merchant cash advance as well as business activities in India and Singapore.
KPMG will report on its full findings in a presentation on April 27, the company said in a statement on Wednesday. “In the remaining days, data inventories still received are to be processed and taken into account,” Wirecard said. The company said last month that the audit had cleared it in three of the four areas.
Wirecard has been trying to rebuild its reputation after facing repeated allegations about its accounting methods. Wirecard’s revenue soared in 2018 after it bought more than 15 companies in a few years. But in a series of articles, the Financial Times reported allegations of accounting fraud at Wirecard in several countries.
“Wirecard may well rally at the open tomorrow, as it often does on headlines, but this doesn’t answer many, many questions and the questions of the scope, other divisions and areas remain,” said Neil Campling, an analyst at Mirabaud Securities.
The company hired law firm Rajah & Tann to investigate its Singapore subsidiaries. A final report from the firm in March 2019 acknowledged accounting oversights and potential criminal liability among some Singapore staff, but didn’t find evidence of any linked to Wirecard headquarters.
The Financial Times also reported that substantial sales and profits were processed by Wirecard’s Dubai-based partner company Al Alam Solutions in the names of several clients that didn’t exist or had no record of a relationship with the firm. The company “categorically rejects” the allegations, calling them “nonsense,” a spokeswoman said in October. Still, the company hired KPMG to do an independent investigation.
The company said it sees no need to correct financial statements from 2016 to 2018. “No evidence was found for the publicly raised allegations of balance sheet manipulation,” it said Wednesday.
Separately, Wirecard supervisory board member Susana Quintana-Plaza is stepping down from the payment processor’s oversight committee, according to her LinkedIn profile and people familiar with the matter.
The manager is leaving the German firm to re-focus on her role as co-chief operating officer of Portuguese utility Galp Energia Sgps SA, one of the people said, adding the departure is unrelated to the Wirecard’s pending publication of a special audit report. She didn’t immediately respond to a LinkedIn message seeking comment.
©2020 Bloomberg L.P.