Steinhoff delays publication of its audited financial statements for 2017 and 2018

Steinhoff CFO Philip Dieperink says the company has set a new timetable that is achievable.

Steinhoff announced on Friday that the publication of its audited financial statements for 2017 and 2018 will be delayed until PwC has finished its 14-month forensic audit of the group. 

The company had hoped to release the results by mid-April, but PwC sent its 3,000-page report to Steinhoff on 15 March and Deloitte was not able to incorporate the findings of the report into group finances in time. 

According to a shareholder update, the issues highlighted in the report have proved to be “exceptionally complex” in both accounting and auditing terms. 

“Steinhoff wishes to be diligent in ensuring that all issues are correctly dealt with and disclosed in the Group’s annual financial statements,” the statement read. 

They expect to conclude on the remaining principle issues within in the next week. 

However, the track and trace process required to ensure that all the appropriate adjustments and journals are audited at each subsidiary and sub-consolidation level, is proving to be more complex and time consuming than the company expected. 

In light of this complexity, the struggling retailer stated that “it is now clear that the mid-April timeline for completing the group consolidated financial reporting and related audit processes cannot be met.”

To ensure that the financial information is communicated as quickly as possible, the group is prioritising the delivery of the 2017 Group financial statements, with those for 2018 to follow six weeks after. 

Steinhoff estimates that it will publish its audited financial statements on the following dates: 

  • Group 2017 financial results – 7 May 2019,
  • Group 2018 financial results – 18 June 2019,
  • Steinhoff Investment Holdings Ltd 2017 – 28 June 2019, and
  • Steinhoff Investment Holdings 2018 – 28 June 2019.

The statement said that the revised timetable is also expected to impact the timing of the release of the unaudited 2019 interim results, which is currently scheduled for 28 June. 

Steinhoff CFO Philip Dieperink said:

“We sincerely regret this further delay. While substantial progress has been made, the volume and complexity of the accounting and audit work required to address the numerous transactions identified in the PwC report and the distraction of the CVA challenge have combined to create a significantly greater workload than was anticipated at the time the mid-April target was agreed. Substantial progress has been made and despite a major and sustained effort from the whole team, more time is required."

He said that, after conducting a thorough review of all outstanding matters with Deloitte, the company has set a new timetable that they believe is achievable. 

“We have a clear view of the task ahead and I would like to assure all stakeholders that we continue to apply maximum effort to bring this process to a conclusion,” he said.