Germany's Wirecard commissions independent audit to diffuse FT report

Source: Xinhua| 2019-10-21 20:02:52|Editor: Li Xia
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BERLIN, Oct. 21 (Xinhua) -- German financial service provider Wirecard announced to commission an independent audit of their accounting practices by audit and tax advisory company KPMG on Monday.

According to Wirecard, the audit was aiming to clarify "fully and independently" all accusations of fraudulent accounting raised by the British newspaper Financial Times (FT).

KPMG would receive "unrestricted access" to all information on all levels of Wirecard's management. Wirecard announced that the results of the audit would be published after completion.

"We assume this renewed independent review will lead to a final end to all further speculation," said Wulf Matthias, chairman of Wirecard.

At the beginning of 2019, the Financial Times had reported about fraudulent accounting practices by a subsidiary company of Wirecard in Singapore which Wirecard's chief executive officer (CEO) Markus Braun has described as a "local difficulty with scant financial impact."

Last week, the British newspaper published internal documents of Wirecard that would prove that the German service provider "fraudulently" inflated sales and profits at Wirecard businesses in Dubai and Ireland.

FT reported that in 2016 around half of Wirecard's pre-tax profit had been generated via a partner company from Dubai called Al Alam. However, many customers contacted by FT whose transactions had been conducted via the partner's platform had never heard of Al Alam.

Wirecard has claimed that FT reporters had facilitated market manipulation in collusion with short sellers and the German financial supervisor (BaFin) has launched investigations.

FT "categorically rejects" Wirecard's allegations "on all counts". The allegations are also subject of a legal complaint in Germany.

Since the first reports about accounting irregularities, shares of Wirecard have lost around 20 percent. Following the announcement of the independent audit which is set to begin "immediately", shares of Wirecard jumped over 7 percent at midday Monday.