The Viennese lawyer Raoul Wagner has been appointed as special administrator by the Commercial Court in the bankruptcy proceedings of Signa Holding filed a lawsuit once morest the Signa-auditor BDO. According to “Kurier”, the core issue is that the auditor of the Signa Holding allegedly prohibited deposit refunds at the Signa Holding in 2021 and 2022. Accordingly, BDO is said to have not audited the balance sheets correctly.
The insolvency-related over-indebtedness of the Signa According to Wagner, Holding’s net assets were said to have amounted to 384 million euros at the end of the 2021 financial year. At the end of the 2022 financial year, the amount is said to have even reached around 972 million euros.
The special administrator accuses BDO Assurance GmbH of the prohibited deposit refund at Signa Holding did not object. BDO is now to be held liable for this.
The restructuring administrators have also appointed other auditors such as KPMG as auditor of Signa Prime and Signa Development is in the crosshairs. PwC and the Austrian tax consultancy firm TPA are also to be looked at. According to the report, the lawsuit once morest BDO is 37 pages long and was served on BDO on June 27th.
“If BDO had carried out the audits of the annual financial statements of Signa Holding 2021 and 2022 had been carried out properly, the duty to speak had been exercised and no unqualified audit opinions had been issued, then the management of the Signa Holding or its creditors (investors) have filed for insolvency proceedings,” the lawsuit states, according to “Kurier”. This would have been the case at the end of April 2022 and not in autumn 2023, during the audit of the 2021 balance sheet. At the same time, “the financiers had made investments in the Signa Holding omitted or investments called due”.
According to the lawsuit, BDO is now to be held liable for the damage resulting from the difference in assets between the date of the audit report for the 2021 balance sheet dated April 27, 2022 (or the audit report for the 2022 balance sheet dated June 28, 2023) and the opening of insolvency proceedings once morest the Signa Holding on November 30, 2023. The core allegation is “prohibited repayment of deposits”. “There was no reason for BDO to assume that the Signa Holding GmbH would have been able to continue as a going concern at the time of the respective (balance sheet) audits,” the lawsuit states.
According to the law, the Signa Holding only had the right to distribute the profits of subsidiaries. All other distributions are prohibited. In fact, the Signa Holding received funds (loans, loans) from subsidiaries amounting to 410 million euros in 2021 and around 1.03 billion euros in 2022. According to special administrator Wagner, these debts of the Signa Holding’s payments to its subsidiaries “were due immediately and might not be deferred or offset”.
BDO did not judge this prohibited deposit refund “as such”. Signa Holding had presented these liabilities with remaining terms of many years, which BDO culpably and unlawfully failed to object to,” said the special administrator. His conclusion: The Signa At the time of the annual financial statement audits in 2021 and 2022, Holding was “insolvent, over-indebted under insolvency law, at risk of going concern and in need of reorganization”.
The BDO’s final audits were also “worthless and damaging”, which is why Wagner is suing BDO for repayment of fees amounting to 249,600 euros.
But even without an insolvency scenario, BDO would be liable. According to the newspaper, Wagner argues that this loan granted by the subsidiaries to the parent Signa Holding did not stand up to a so-called arm’s length comparison. The shareholder “Signa Holding received something that would never have been granted to an outside third party (…) in this form,” it continues. Therefore, a violation of the ban on the return of deposits must be affirmed.
BDO Assurance said it might not comment. “As auditors, we are subject to very strict confidentiality obligations.”
