Friday, July 31st, 2020
Wirecard AG has recently reported that the missing €1.9 billion of cash balances on its trust accounts are likely to have never even existed. Let’s move forward to learn more about the case with the German fintech company.
Wirecard’s Missing €1.9B Cash Balances
Munich-based payment-company Wirecard processes tens of billions of Euros in credit/debit transactions on a yearly basis. The company’s accounting practices have already taken 18 months of battling over the mentioned concerns.
The company’s shares dropped over 60% when auditors warned that €1.9bn wasn’t available on its accounts. Ernst and Young (EY) was the appointed auditor.
The payment company had been thinking that the trust accounts could be beneficial in terms of its relations with a 3rd-party acquiring business and referred to them as assets in its financial accounts. However, the company’s management board has now reported that such descriptions associated with 3rd-party acquiring businesses weren’t correct.
More on German Fintech’s Case
The auditor didn’t sign off on the fintech company’s 2019 accounts. As a result, this has been the 4th time the company has postponed publishing its financial report. Besides, the German payment company hasn’t provided its initial 2019 and Q1 2020 financial results, as well as its predictions.
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So, the German payments firm, which was once considered the future of financial technologies in the country, has appeared in a scandal. The thing is that €1.9 billion of cash is missing on its balance sheet. As the fintech company has mentioned, the balances on the trust account may not even exist.