EY reports Datalex to companies registrar over accounts

Review found ‘significant accounting irregularities’ at travel software group last year

The travel software company first warned of suspected accounting irregularities in January. Photograph: iStock

The travel software company first warned of suspected accounting irregularities in January. Photograph: iStock

 

Beleaguered travel retail software group Datalex said on Wednesday that its auditor, Ernst & Young (EY), has reported it to the Registrar of Companies for failing to keep adequate accounts last year.

The move comes as Datalex prepares to publish its long-delayed financial statements for 2018. A board-commissioned review published in May confirmed that there had been “significant accounting irregularities” at Datalex last year and that it reported revenues for the first half of 2018 that had been overstated.

Datalex first warned of suspected accounting irregularities in January, sending its shares tumbling by almost 60 per cent in one day. It brought in its former auditors, PwC, to carry out the independent review.

EY was obliged under the Companies Act 2014 to state that it had separately formed an opinion that Datalex failed to comply with the law by keeping adequate accounting records in 2018.

“The company takes its legal and corporate governance responsibilities very seriously and seeks to comply at all times with all relevant laws and regulations,” Datalex said in a statement issued to the Dublin stock exchange, where its shares have been suspended since May due to delays in the publication of the company’s annual accounts.

Effort

“The company has expended significant effort over the course of 2019 in the taking of corrective actions to address the shortcomings identified by the independent review of accounting issues (conducted by PwC in conjunction with the company’s legal advisers),” it said.

“The board is satisfied that, while it continues to assess the group’s material risks and effectiveness of its internal controls, it has taken all appropriate immediate action,” it said, adding that it expects to publish its full-year financial statements “very soon”.