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19 Oct 2020 | 07:59

Boohoo says PwC is stepping down as auditor

(Sharecast News) - Boohoo shares slid on Monday after the fast fashion retailer confirmed that PricewaterhouseCoopers (PwC) will not be participating in its tender process for a new auditor. Over the weekend, press reports suggested that PWC was stepping down as auditor of the company due to concerns about governance.

Boohoo - which has been rocked over the last few months by allegations of poor working conditions at some of its suppliers - said in a very brief statement: "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."

Broker Shore Capital said it will be interesting to see which firm is appointed as their new auditor following publication of the Levitt enquiry.

"Perhaps, appointing a new auditor will not be a walk in the park as any new auditor will want to understand what has changed/is changing at the company.

"The change of auditor follows the review by an independent QC that criticised weak corporate governance at the company. The company has also faced controversy over its executive pay plan that will hand senior executives up to £50m each, dependent up on the share price over the next few years.

"Boohoo is breaking with the UK corporate governance code and not putting the plan to a shareholder vote."

At 0817 BST, the shares were down 15% at 266.70p.
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