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Wirecard scandal: EU Commission may want auditors to be more liable

2021-01-18T21:13:45.131Z


After the mishaps in the inspection of Wirecard, Brussels is discussing a "sufficiently high or even unlimited liability of the auditors". This is to prevent compromises in the financial statements.


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Offices of consultants and auditors from EY: In the Wirecard scandal, they drew fake balance sheets for a whole decade

Photo: ARND WIEGMANN / REUTERS

The Wirecard affair made the EY auditors look bad.

But that's not all: The company and the other audit firms - KPMG, Deloitte and PwC are among the industry giants - could face stricter liability rules.

"Sufficiently high or even unlimited liability of the auditors can offer incentives to prevent compromises being made in final audits that lead to lower-quality audits," says a discussion paper of the EU Commission as a consequence of the Wirecard scandal that was the first to report the "world".

more on the subject

  • EY in dispute with supervisory authority: What guilt do the auditors have for the Wirecard debacle? By Tim Bartz, David Böcking, Martin Hesse and Gerald Traufetter

  • Icon: Spiegel Plus Wirecard Chronicle: The scandal of the year by Tim Bartz and Martin Hesse

  • Result of the Wirecard scandal: EY auditor apparently loses mandate at Telekom

  • Icon: Spiegel Plus Financial scandal: Wirecards fanboys in the banks By Tim Bartz, David Böcking, Martin Hesse and Gerald Traufetter

  • Icon: Spiegel Plus Financial scandal: The spy who loved Wirecard by Tim Bartz, Martin Hesse and Gerald Traufetter

The paper describes possible omissions by the supervisory authorities and raises the consequences for debate.

The commission paper criticizes that "confidentiality rules in Germany could have had a negative impact on the discovery and investigation of the violation of accounting standards".

Better exchange of authorities required

According to the paper, the European supervisory authority ESMA also criticized difficulties in the cooperation between the financial supervisory authority BaFin, the German auditing agency for accounting and the German auditor oversight agency APAS.

In future, EU law could explicitly state that the exchange of information between competent national authorities does not constitute a breach of professional confidentiality, it says.

The former Dax group Wirecard had granted air bookings of 1.9 billion euros in June 2020 - according to investigations by the public prosecutor, it could total more than three billion euros.

EY had checked the Wirecard balance sheets for years and failed to notice, including Commerzbank, the DWS fund company, KfW Bank and, presumably, Telekom, as a result of which the auditors withdrew their mandate.

Because the extensive fraud - according to the Munich public prosecutor's office - remained undetected for years, the BaFin, among others, has come under fire, some of whose employees speculated extensively with Wirecard shares even though they were supposed to be monitoring the group.

The CSU MEP and financial expert Markus Ferber sees no systemic deficits, at least on the part of the EU: "In the Wirecard case, BaFin failed, not the European level."

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apr / dpa

Source: spiegel

All business articles on 2021-01-18

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