PwC and KPMG may have participated in fraud, says Americanas – 06/13/2023 – Market

The CEO of Americanas, Leonardo Coelho Pereira, presented emails and other message exchanges to the CPI (Parliamentary Commission of Inquiry), which investigates the company’s accounting fraud, with alleged evidence that the company’s balance sheets were intentionally altered to artificially inflate profits. He also stated that there are indications of participation by audit firms PwC and KPMG.

“This information does not allow me to treat [o caso] such as accounting inconsistencies”, said Pereira in his opening speech at the CPI.

Pereira presented an exchange of emails with KPMG in which the final letter with the audit recommendations is discussed in search of a final wording.

In this discussion, the audit ends up replacing recommendations for the board of directors with “recommendations that deserve management attention”.

The change in wording reduced the degree of the problem by implying that the problems did not need to be taken to the board of directors, the highest level of the company, and could remain at the management level.

In another wave of documents, Pereira pointed to a “letter that indicates that PwC [empresa de auditoria] I was indicating how to write text in which the risk theme was removed [mecanismo utilizado para operacionalizar a fraude] it wasn’t clear”.

In cases involving audits, Pereira pondered that the information still needed more context because falsified documents were presented to them.

The CEO also presented an email sent by former director Marcelo Nunes, former financial director of Americanas, to the entire board of directors of the company at the time. In a balance sheet called “internal view”, it shows a loss before interest, taxes, depreciation and amortization for 2021 of R$ 733 million.

Another document in the same message exchange titled “advisory vision” brings a profit for the same item of almost R$ 2.9 billion. That was the number presented to the market.

“Between the internal view and the board’s view, BRL 3.5 billion in results were created. Americanas’ fraud is a result fraud”, stated Pereira.

The management’s awareness of the case was also evidenced with messages in a WhatsApp group with its members. In them, the participants clearly stated that if too much leverage was presented to the board “it would be sudden death”.

Pereira also pointed out that the board falsified documents requested by the audits by forging signatures.

“The forged letter with invented numbers were digital signatures of real letters, a fraud that happens in most of the letters that were circularized for the audit”, he explained.

In January of this year, Americanas disclosed in a material fact that it had found “accounting inconsistencies” of around R$20 billion in its balance sheets. The move was followed by the departure of the then CEO, Sergio Rial, who had been in office for less than a month. Pereira took over the post in February, already during the company’s judicial recovery.

This Tuesday (13), the retailer assumed for the first time that there was a fraud based on a report made from documents of the independent investigation committee, created at the end of January.

The report points out that the fraud occurred in the supposed contracting of bonuses with the industry – when manufacturers give discounts for large orders, which the report identified as “cooperative advertising budget contracts and similar instruments (VPC)”.

The discounts did not actually occur. With the supposedly advantageous negotiations, the company improved its balance sheet. On the other hand, to make payments to suppliers, the previous board contracted loans without the knowledge of the board of directors, which increased its liabilities, irregularly accounted for, says the document.