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German regulator hands EY 2-year audit ban over Wirecard scandal – Handelsblatt
Home > Top Stories > German regulator hands EY 2-year audit ban over Wirecard scandal – Handelsblatt
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BERLIN (Reuters) – German accounting watchdog APAS has banned EY from taking on new audits for companies of public interest for two years and handed the firm a 500,000 euro ($541,650.00) fine, German
BERLIN (Reuters) – German accounting watchdog APAS has banned EY from taking on new audits for companies of public interest for two years and handed the firm a 500,000 euro ($541,650.00) fine, German business daily Handelsblatt reported on Monday.
APAS declined to comment on the matter. The regulator is expected to release a statement on its decision to sanction EY later on Monday.
EY was not immediately available for comment.
Wirecard filed for insolvency in June 2020, owing creditors almost $4 billion, after disclosing a 1.9 billion euro hole in its accounts that EY said was the result of a sophisticated global fraud.
The company, founded in 1999, began by processing payments for gambling and pornography websites before becoming a fintech star and a member of Germany’s blue chip DAX index.
APAS found massive breaches of duty by EY in connection with the scandal, Handelsblatt said citing sources familiar with the matter.
The reported ban forbids EY from participating in tenders for audits of certain companies for two years. This includes all listed companies as well as the majority of the financial sector consisting of banks and insurance companies, Handelsblatt said.
($1 = 0.9231 euros)
(Writing by Rachel More, additional reporting by Joern Poltz, Editing by Friederike Heine, Kirsti Knolle)
An audit is an independent examination of financial information of any entity, whether profit-oriented or not, regardless of its size or legal form. The purpose is to ensure accuracy and compliance with established standards.
Insolvency is the state of being unable to pay the debts owed, typically leading to bankruptcy proceedings. It indicates that a company’s liabilities exceed its assets.
A regulatory framework consists of the rules, regulations, and guidelines that govern the operations of financial institutions and ensure compliance with laws and standards.
Accounting is the process of recording, classifying, and summarizing financial transactions to provide useful information for decision-making. It is essential for businesses to track their financial performance.
A fine is a monetary penalty imposed by regulatory authorities on individuals or organizations for violations of laws or regulations. It serves as a deterrent against non-compliance.
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