Commissioned by Codere SA governance, ‘Big 4’ accountancy EY has confirmed a total impact of €15 million losses attributed as ‘intentional LatAm inconsistencies’ which will be accounted for in the Bolsa Madrid gambling group’s full-year 2019 results.
October trading saw Codere declare to Spain’s CNMV markets authority that year-to-date accounts had been overstated by a reported €13-20 million attached to the firm’s LatAm business unit.
The embarrassing chapter would see Codere governance launch an internal investigation led by management consultancy Alvarez-&-Marsal which revealed approximately €14 million in ‘inconsistent earnings’ primarily attached to the firm’s Mexican gambling subsidiary.
Codere governance maintains that the firm’s manipulated accounts were ‘coordinated by a small group of people working in Mexico’– ‘without the knowledge of corporate management in Madrid’.
In its November update, Codere governance confirmed that it had sanctioned a review of its ‘corporate structure’ related to corporate leadership and internal systems and controls.
The Bolsa Madrid firm had commissioned EY to review its 2019 corporate accounts, concluding further net losses €15 million recorded during H12019 trading – a period in which Codere governance detailed stability reducing its losses to €8.5 million.
However, posting dire Q3 trading in which the company recorded declines across all major operating territories, the embattled Spanish gambling group would see its 2019 losses widen to €33 million.