The Aftermath of the Wirecard Scandal: The Impact on EY and Its Auditors

Wirecard scandal: Consequences for auditors EY

The professional supervisory authority for auditors has sanctioned EY and individual auditors in connection with the Wirecard scandal. The auditor oversight body at the Federal Office of Economics and Export Control (APAS) stated that EY breached professional duty when examining the financial statements of the former payment service provider from 2016 to 2018. EY has confirmed that it has been informed about the completion of the Apas exam, but the details of the decision are not yet known. The auditing company has been fined 500,000 euros and will not be allowed to carry out any statutory audits for companies of public interest for two years.

New mandates are excluded, and five auditors were also fined between €23,000 and €300,000. The spokesman for the Federal Office of Economics and Export Control did not provide any information on the total fines. The Apas decisions are to be prepared, and those affected can then lodge an objection against them. It is the most extensive procedure that Apas has carried out so far.

EY fully cooperated with Apas throughout the investigation, and the company regrets that the fraud at Wirecard was not uncovered earlier. The company has learned important lessons from the case and has taken comprehensive measures to strengthen audit quality and risk management. Wirecard collapsed in the summer of 2020 after the board admitted that €1.9bn allegedly booked in escrow accounts could not be found. The former Wirecard boss Markus Braun is currently being tried in Munich. EY had tested the allegedly falsified balance sheets of the former Dax group for years.

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