WPP to restate accounts following error

The firm yesterday said that its accounts for the years up to 31st December 2017, 31st December 2018 and 31st December 2019 were not fully in accordance with the accounting standards IAS 32 and IAS 39.

A statement from WPP said the specific issue related to the presentation of cash and overdrafts within notional cash pooling arrangements, which did not meet the requirements for offsetting in accordance with IAS 32.

WPP also said in its statement that its approach net investment hedging did not comply with the criteria set out in IAS 39.

The statement said that any adjustments as a result of these issues would not affect any of WPP’s headline measures, operating profit, net debt, net assets, net current liabilities or statement of cash flows.

The previously issued financial statements for 2019 and the first six months of 2020 will be reissued by WPP, with both included in an amended annual report.

Earlier this year, WPP introduced cost savings including freezing new hires, stopping discretionary costs, postponing salary increases and a 20% drop in executive salaries to save more than £700m in 2020.  WPP completed the sale of 60% of Kantar to private equity firm Bain Capital last year.