What role do EY listeners play in the insolvent group Wirecard scandal? For years, they had nothing to complain about in the balance sheets. Now it’s going public: Altmaier supervisors are investigating
In the scandal surrounding the Wirecard group’s insolvency and billion-dollar airline bookings, Ernst & Young (EY) auditors have also come under the public eye. Auditor Oversight (APAS), located at the Federal Economy Ministry, has been investigating EY since fall 2019. A spokesperson for the ministry confirmed this to t-online.de.
The “Handelsblatt” had previously reported on a confidential report from the supervisory authority. The ministry underlined that Apas had the statutory mandate to verify the respect of the professional obligations of the auditors of the companies of public interest. This also includes the Wirecard group.
Proceedings against EY auditors are pending
In the Wirecard case, it opened a preliminary investigation in October 2019, “which was transferred to a formal professional oversight procedure in May 2020 after the report was published by the audit firm KPMG,” the spokesperson said. word of the ministry. This procedure is therefore in progress.
KPMG, a competitor of EY, was supposed to erase the allegations against the out-of-the-world group on behalf of Wirecard with a special audit – something KPMG was unable to do. KPMG presented the report at the end of April this year.
According to “Handelsblatt”, Apas will review all annual and consolidated financial statements from 2015 by EY at Wirecard to verify their compliance with legal and professional requirements. In the event of a breach of duty, the Apas has many options for sanctions, including fines and even exclusion from the profession.
For years listeners had no complaints
EY is heavily criticized because auditors have certified payment service provider Wirecard for a correct record for years. It was not until mid-June 2020 that they refused to issue a certificate to the group, which means that they did not approve the financial statements for the previous year.
As a result, the company had to admit that the € 1.9 billion funds on the balance sheet were nowhere to be found. These funds should actually be in escrow accounts in Asia.
A week later, Wirecard filed for bankruptcy. The Munich public prosecutor’s office is investigating the case. It is now based on commercial gang fraud.