Board reshuffle has failed to lessen Steinhoff woes
The situation is close to a worst-case scenario, say analysts as Steinhoff's chairwoman reveals questionable assets include cash equivalents
Media reports suggesting "accounting irregularities" at Steinhoff are older and more pervasive than initially thought, and the Steinhoff board’s revelation that the group’s cash resources were also overstated, saw the share price plummet 19.4% on Friday to close at R4.11. Last week Steinhoff chairwoman Heather Sonn added to investor jitters when she said PwC was still in the early stages of its investigation and the task it faced was "substantial, complex and time-consuming". Sonn revealed that the €6bn of questionable assets included cash-equivalent assets. She also referred to the overstatement of profits and the need for material additional impairments as a result of the accounting treatment of related parties. On Friday, as the share price slumped to a record low, analysts said the media reports and Sonn’s comments indicated the situation was close to a worst-case scenario.
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