Status: 01/26/2023 3:36 p.m
The auditing company EY wants to significantly cut jobs in Germany. It is not yet clear how many positions will be affected. This is intended to improve profitability again after the Wirecard scandal.
The auditing company EY wants to save in Germany and is therefore planning structural changes. A spokesman for EY said by email that these relate to personnel measures and the reduction of costs that are not related to personnel. The company – formerly known as Ernst & Young – has already started talks with employee representatives.
Cut 380 jobs and 40 partners?
The “Financial Times” (FT), citing internal sources, had previously reported that EY Germany was planning to cut 380 employees. In addition, the contracts of 40 of the approximately 800 partners are to be terminated in order to improve profitability after the Wirecard scandal. The majority of the partners affected by the job cuts are part of the company’s audit arm, according to the FT report.
The auditing company formerly responsible for Wirecard confirmed on Wednesday that individual auditors had decided to waive their approval. According to the “FT” and the “Wirtschaftswoche”, the auditors avoid possible penalties from the supervisory authority for any errors in the annual financial statements controls at Wirecard.
Seats lost after Wirecard scandal
Wirecard collapsed in June 2020 when it became known that 1.9 billion euros were missing from the till. Three former managers of the DAX group have been accused of accounting fraud, market manipulation, breach of trust and gang fraud before the Munich Regional Court. Further investigations are ongoing. The auditing company EY, which had approved the group’s balance sheets for years, was also criticized.
As a result, EY had lost several major audit mandates in Germany, including from Commerzbank, DWS and KfW. Commerzbank boss Manfred Knof filed a lawsuit against EY at the turn of the year and wants to get back 200 million euros from the auditors.