The long-awaited summary of PwC's more than 3,000-page forensic investigation into Steinhoff's activities has identified what it described as fictitious and irregular transactions with parties that appeared to be closely related to the same small group of people. Irregular transactions with eight firms not tied to the Steinhoff group from 2009 and 2017 amounted to €6.5bn ($7.36bn), the 10-page PwC summary released on Friday showed.
The summary did not name the deals the auditing firm had found to be questionable, but said they fell into four categories, including profit and asset creation, asset overstatement and reclassification, asset and entity support, and contributions.
Also read: Steinhoff – the FULL story: From small furniture shop to retail giant
"In general terms, the PwC report finds that the fictitious and, or irregular transactions had the effect of inflating the profits and, or asset values of the Steinhoff group," according to the summarised report. "The PwC report identifies three principal groups of corporate entities that were counter-parties to the Steinhoff group in respect of the transactions that have been investigated."
'Legal privilege'
PwC was mandated by Steinhoff to study the retailer's accounts when it disclosed irregularities at the end of 2017. Swamped with work, the auditing firm was limited to investigating transactions dating back to 2009, the summary of the report shows. The full report will not be made public because it is "confidential and subject to legal privilege and other restrictions," the accounting firm said.