Revolut’s auditor BDO was not able to independently verify three-quarters of the £636m total revenue reported by the fintech firm in its long-delayed 2021 accounts, Revolut’s annual report showed.
The 2021 accounts were signed off this week after months of delays, following a revamp of Revolut’s internal accounting systems and heavy regulatory scrutiny.
But BDO flagged concerns that it could not verify £477m of revenue, nor vouch for their “completeness or occurrence”.
The company’s “IT systems weren’t designed in such a way that would allow for IT or business process controls to be effectively tested throughout the year,” BDO added.
“Verification procedures are not able to provide sufficient appropriate assurance” over Revolut’s main revenue generators which include subscriptions, cards delivery, foreign exchange and wealth, it added.
BDO warned that some information may be “materially misstated”. A spokesperson for BDO declined to comment further.
A spokesperson for Revolut said the bank’s overall revenue figure “was not in question” and BDO’s concerns were “remedied in 2021”.
Revolut made its first full-year profit in 2021 of 26 million pounds after a 2020 loss of 223 million pounds, as total revenue nearly tripled helped by a boom in cryptocurrency trading, a key part of the group’s business.
Revenue jumped again by 33 per cent last year to more than 850 million pounds on the back of payments, subscriptions and business accounts, said Chief Financial Officer Mikko Salovaara, despite a downturn in crypto, which made up around 5 -10 per cent of total income.
The company replaced its internal accounting systems after the Financial Reporting Council, a UK body responsible for regulating auditors, said Revolut’s audit for 2020 was “inadequate” and that “the risk of an undetected material misstatement was unacceptably high”.
Salovaara declined to say whether the company was profitable in 2022. It expects to publish annual accounts by June, although it could take longer, retaining BDO for the audit.
By Stefania Spezzati, Reuters