Risk Reporting in the Notes to the Consolidated Financial Statements and Group Management Reports

Every company takes risks to benefit from opportunities. Some company risks become so concrete that risk provisions have to be created for them—assets are subject to impairment and provisions have to be built. However, this does not provide an overall overview of current and future risks. Therefore, capital market-oriented companies based in Europe are subject to a twofold risk reporting obligation. The first obligation arises from applying IFRS accounting rules. The other results from an EU requirement being transferred into national law. Regarding the disclosure of financial risks, there is some overlap between the international and the national requirements. In the following, we differentiate between financial risks and other risks. The obligation to present financial risks is essentially based on an international accounting standard, while the other risks had to be presented largely based on a supplementary national standard. Both accounting standards were seriously breached which we will elaborate on in detail. Despite his knowledge of the business model, the auditor did not insist on reflecting the reality of Wirecard's risk situation. Instead, he allowed the actual risks not to be addressed at all in some cases and the overall risk situation of the group to be completely concealed, which again represents a massive breach of his professional duties.