Conforama’s parent, Steinhoff International, has seen its shares continue to slide, losing 73% of their value in two days as accusations of accounting irregularities and tax fraud continue to circulate.
Steinhoff’s management, now minus its chief executive, revealed that it was undergoing a criminal investigation in Germany over irregularities going back to 2015.
Chief executive Markus Jooste is out, but the company which employs 130,000 people and is represented in Portugal with the Conforama brand of furniture stores, is in serious difficulty with the presentation of its results now postponed indefinitely while PwC carried out an emergency audit.
"Steinhoff's supervisory board informs its shareholders that it has had access to new information that relates to accounting irregularities that require further investigation," stated the company on Wednesday with Christo Wiese, Steinhoff's chairman and largest shareholder, taking over control in an effort to placate shareholders.
Suspicions about the company's accounts began in November when Reuters spotted that Steinhoff had hidden from investors transactions with a related company worth almost USD1 billion. The corporate tax bill also has raised suspicions as
The tax bill has also raised suspicions, with Steinhoff International paying an average of 12% in tax over the past five years, less than half the rate its competitors.
Comments
I suspect that the modern audit is less than useless, since the auditors are in a comfy relationship with the companies they audit. There is a good case for the enforced change of auditor every year.