Gerresheimer: Bafin announces further balance sheet audits - Gerresheimer faces deeper BaFin probe over questionable accounting practices
Gerresheimer is under fresh scrutiny after Germany's financial regulator, BaFin, announced an expanded investigation into its accounting practices. The company had previously been criticised for improperly recognising revenue from 'bill-and-hold' contracts, breaching international financial rules.
The issue centres on Gerresheimer's early recognition of finance from agreements where goods had not yet been delivered. Under IFRS standards, finance should only be recorded once products are shipped, not when invoices are issued. The company has since adjusted its accounting methods and brought in a second audit firm to review its financial reporting.
BaFin had already raised concerns about these contracts in earlier assessments. Now, the regulator will extend its existing review and launch a new probe covering December 1, 2024, to May 31, 2025. The move follows ongoing questions about the accuracy of Gerresheimer's financial statements.
Investors reacted quickly to the news, with the company's share price falling after the announcement of the expanded audit.
The additional investigation means BaFin will examine Gerresheimer's financial practices more closely over the next several months. The regulator's findings could have further implications for the company's reporting standards and compliance with accounting rules.
