The auditor oversight Apas has in connection with the Wirecard– Scandal breaches of duty by the auditor EY and five of his employees found and therefore high penalties imposed. The auditor was not allowed to take on any new audit mandates for public interest companies for two years, Apas announced on Monday. This includes all listed companies Germany. There is also a fine of 500,000 euros. The sanctioned EY employees each have to pay fines of between 23,000 euros and 300,000 euros.
The professional supervision procedure against seven other auditors had previously been discontinued. The people had each other deprived of a possible penaltyby no longer wanting to work as an auditor.
In its most extensive procedure to date, Apas had investigated EY’s involvement in the Wirecard case. The decision-making chamber “Professional Supervision” made its decision on March 31, 2023. The authority “regards breaches of professional duty as proven when examining the financial statements of Wirecard AG and Wirecard Bank AG in the years 2016 – 2018”.
The ban on taking on new mandates hits EY hard. The market share had recently shrunk anyway, the rivals PwC and Deloitte currently support more companies in the leading index Dax40; KPMG is on par. EY currently supports eight DAX companies: airbus, Beiersdorf, Deutsche Bank, Munich Re, Symrise, Zalando and the two car groups Volkswagen and Porsche. In the past 2021/22 financial year, sales in the testing division at EY fell by almost four percent to 659 million euros, while the competitors Deloitte and PwC each grew by around ten percent. In total, EY had a turnover of around 2.3 billion euros in Germany.
The existing mandates of the auditors are not affected by the Apas ban; they can be extended up to the statutory maximum limit of ten years. The mandates at Airbus, Zalando and Beiersdorf expire in 2024.
The Wirecard scandal has triggered a whole series of damages and criminal proceedings. EY is faced with claims for damages, which the company has rejected. Three former Wirecard managers are before the Munich Regional Court
charged with accounting fraud, market manipulation, embezzlement and gang fraud.
EY confirmed on Monday that it had been informed about the completion of the Apas test, but details are not yet known. EY Germany cooperated fully with Apas throughout the investigation. Those affected can lodge an objection to the decision with Apas and, if an objection is rejected, sue in court. The Apas emphasized that these are exclusively the consequences of professional supervision, which are not binding for other procedures.
Wirecard collapsed in June 2020 when it became known that 1.9 billion euros were missing from the till. Three former managers of the Dax group are therefore accused of accounting fraud, market manipulation, infidelity and gang fraud before the Munich Regional Court, including the former company boss Markus Braun (54). Further investigations are ongoing.
The auditing company EY, which had approved the group’s balance sheets for years, was also criticized. alone Commerzbank the Wirecard bankruptcy had cost around 200 million euros. As reported by manager magazin, CEO Manfred Knof (57) has since sued the auditor. If he was successful, he would write legal history.