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Steinhoff seeks fresh start, nominates new auditor

Aug 31 2019 14:51
Janice Kew, Bloomberg

Steinhoff International Holdings NV nominated Mazars as its new auditor as the South African retailer looks for a fresh start after an accounting scandal almost destroyed the company.

Mazars accepted an offer to replace Deloitte, Steinhoff's board said at its annual general meeting in an Amsterdam hotel on Friday and shareholders will be able to vote on the proposal at a later date.

Deloitte's refusal to sign off on Steinhoff's financials for the year through September 2017 ultimately brought to light a web of inflated asset values and dubious third-party transactions that caused the share price to collapse. However, it later emerged that the firm had signed off on audits from previous years that were similarly flawed, and Deloitte is being investigated by accounting regulators.

Shareholders present at the meeting were quick to question how Steinhoff had come to select Mazars and whether its up to the task. While Deloitte has reviewed and restated earnings for 2017 and 2018 after months of work, little over 50% of investors voted to approve the results, with many abstaining.

Among investors present at the meeting were representatives of VEB, the Dutch firm leading a class-action lawsuit against Steinhoff in the Netherlands.

They urged Steinhoff's management, led by CEO Louis du Preez and chair Heather Sonn, to release the full version of a forensic report by PwC into the financial transactions behind the crisis.

The executives reiterated that the results of the probe could not be released due to ongoing legal action against the company.

Equally, publication may jeopardise Steinhoff’s claims against former managers, company officials said, including ex-CEO Markus Jooste.

steinhoff  |  deloitte  |  mazars  |  retail  |  accounting


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