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Revolut defends its revenues.

 

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Revolut has said its 2021 revenues are «not in question» despite concerns from external auditors about the «completeness and occurrence» of close to £500 million worth of turnover. The company, one of Britain’s most valuable start-ups, alleged that its annual accounts had been «misreported» in articles which said auditors from BDO had been unable to verify about three-quarters of its 2021 sales. Revolut claimed that «some of the reporting on Wednesday incorrectly reported BDO’s audit opinion». It alleged that BDO was saying it could not confirm precisely which revenue stream funds were coming from rather than casting doubt on the volume of revenue reported.

 Revolut said it stood by the comments, which have put BDO in a difficult position. Revolut was founded in the UK in 2015, offering transfers and foreign exchange services as it sought to outpace and undercut the large incumbent banks. The delays came after the quality of the 2020 audit by BDO came under review by the Financial Reporting Council, the regulator. The problems highlighted by BDO related to issues with Revolut’s IT system which are understood to have created difficulties with reconciliation. This accounting process compares two sets of records to ensure the figures are correct and in agreement.

A payments industry veteran, who asked not to be named, said reconciliation is a «fundamental requirement of any financial platform» and that the audit qualification had raised new questions about Revolut’s efforts to secure a UK banking licence, which would allow it to expand its range of services for customers in Britain. «How can the company not know its subscription revenue?» he wrote on Twitter. Mikko Salovaara, the group chief financial officer of Revolut, said this week that the issues were down to «an IT system that wasn’t scaled» to meet the company’s rapid growth. The company indicated the problems were resolved in mid-2021, and Salovaara has said he did not expect it to be a «recurring issue».

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  1. Edgar5 March 2023 at 11:18

    So many companies grow way too fast and their IT systems can't seem to keep up. Let's hope this is the case here and we are not dealing with something else entirely.

    ReplyDelete
    Replies
    1. Josh5 March 2023 at 14:18

      I always wonder why such companies don't just get an outside team to fix their IT system and improve it as they go. I mean, just invest in this because it's one of (if not the most) important aspects of such a business. You can't afford to have problems here.

      Delete

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