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Wirecard scandal: Financial supervisors doubts EY's suitability as an auditor


In the Wirecard scandal, Bafin is targeting the audit company EY. The supervisors determine whether the consultants are allowed to examine the annual financial statements of various financial groups.

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EY office building in Berlin: Achievement of the examination purpose at risk?


Jens Kalaene / dpa

It is not currently running at Ernst & Young (EY).

The EU Commission is considering making auditors more liable because of the Wirecard scandal.

Now the German financial supervisory authority Bafin is also checking after the billions of dollars in accounting scandal, whether EY is at all unreservedly suitable as an auditor.

As can be seen from a response from the Federal Ministry of Economics to an FDP request, it is being investigated whether it is appropriate for EY to check the balance sheets of various financial groups.

Specifically, it says in official German: “The Bafin is currently investigating whether an audit of the financial statements of the companies it supervises by Ernst & Young GmbH WPG would jeopardize the achievement of the audit purpose, and if so, whether certain measures would jeopardize it can be excluded by the company. "

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 go up to more than three billion euros.

The payment processor slipped into bankruptcy after it became known.

The Munich public prosecutor's office is investigating, among other things, falsification of accounts, fraud, market manipulation and money laundering.

Bafin has never turned down auditors

EY had checked the Wirecard balance sheets for years and hadn't noticed the air bookings.

The company is therefore under criticism just like the Bafin.

Among others, Commerzbank, the fund company DWS and KfW-Bank have already withdrawn the audit mandate from EY.

Financial groups have to declare their auditors to the Bafin, this does not only apply to EY.

The Bafin can refuse them.

According to the Ministry of Economic Affairs, this has never happened before.

In the specific case, the review has not yet been completed.

The Bafin and EY did not want to comment.

According to the »Handelsblatt«, which first reported on the examination, the FDP MPs asked whether there were any fundamental doubts about the suitability of EY as an auditor.

They also wanted to know whether it would be problematic for EY to check the financial statements of companies which, for their part, were reviewing liability claims against EY because of the Wirecard case.

This applies to Commerzbank and the state development bank KfW, among others.

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apr / Reuters

Source: spiegel

All business articles on 2021-03-02

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