Skip to content
Home / News |

Boohoo Share Price Crashes as PwC Set to Resign on Reputation Concerns

Boohoo
Nigel F

Shares of boohoo Group PLC (LON: BOO) crashed over 26% on Monday after the audit giant PricewaterhouseCoopers (PwC) is reportedly stepping down as its official auditor.

The Financial Times reported on Saturday that PwC is preparing to quit working with boohoo over concerns that the company faces scrutiny over wrongdoing in Leicester supply chain.

The fast-fashion firm had been accused of working with companies that pay workers as little as £3.50 ($4.60) an hour in Leicester. These factories are supplying boohoo with products according to findings from a review conducted by Allison Levitt QC.

X testing X
WELCOME BONUS - Free Share Bundle When You Invest £50! Get up to £500 cashback for investing with IG.
Invest in 15,000+ shares and ETFs. Open an account now, invest at least £50, and you’ll get a free share bundle worth between £40 and £200. T&Cs apply.
5.0
Open Account Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Accordingly, “many failings in the Leicester supply chain” were found and Allison Levitt QC, therefore, recommended “improvements to boohoo’s related corporate governance, compliance and monitoring processes.”

The embattled company released a statement this morning to confirm that PwC is still the company’s official auditor. However, this may change in the near future.

“The Group would like to place on record that PwC is still the Group’s auditor at this time. The Group’s Audit Committee has recently launched a competitive tender process for the Group’s audit, and will update shareholders at its conclusion.

“PwC signed an unqualified opinion on the Group’s 2020 Financial Statements and having served as the Group’s auditor since 2014, is not participating in this process,” the company said.

Boohoo share price collapses on PwC resignation reports October 2020

Boohoo share price opened 11.5% lower on Monday before extending losses to trade more than 16% in the red. Shares now trade at the lowest levels since August.

PEOPLE WHO READ THIS ALSO VIEWED:

Nigel F
Nigel F
Team Member

Nigels tiefes Verständnis der Finanzmärkte basiert auf über 10 Jahren Erfahrung. Nigel wurde bisher zweimal von der FCA (Financial Conduct Authority) autorisiert und hat in der letzten Zeit eine Finanz-Brokerage Firma besessen und verkauft. Er liefert hochaktuelle Analysen und Einsichten in die Finanzmärkte und in die allgemeine Wirtschafts- und Währungspolitik des Vereinigten Königreichs, der USA, Europas und Asiens.