1014 — Adecco’s accounting practices under probe

Jan 14, 2004 | Conteúdos Em Ingles

Fears of a new financial scandal rose on Monday after Adecco, an international temporary employment agency based in Switzerland, reported accounting problems that slumped its share price by more than 40 per cent. Adecco delayed the publication of its 2003 full year accounts, originally planned for 4 February. The Swiss-based firm said it had identified ‘material weaknesses in internal controls’ in the group’s North American operations. Adecco has 28,000 staff in 68 countries. Its 2002 sales were worth €16,100 million.

Investors deserted the stock fearing that Adecco may be on the verge of an major accounting scandal like that gripping Italian food giant Parmalat. Adecco said it has launched an independent inquiry and appointed a lawyer from outside the group to report to the board’s audit committee.

The news sent already jittery financial markets into a frenzy, wiping more than 40% off Adecco‘s share price on the Zurich stock exchange during a half day of trading. Twelve million euros of the group’s shares changed hands, about half the volume of the 26 top stocks on the Swiss SMI index.

“There was a panic reaction, people fear a scandal like Enron or Parmalat as soon as they hear the term ‘accounting problems,” said Thomas Veillet, an analyst with Swiss investment company Dynacapital.

Adecco Staffing North America, which covers the USA and Canada, represented 3.3 per cent of the Group operating income before amortisation during the first nine months of 2003.

with AFP

Em Foco – Empresa