Restatement of Previously Issued Financial Statements
Similarly, any previously furnished reports, such as earnings releases, investor presentations or other communications describing the Company’s consolidated audited financial statements, and condensed consolidated interim financial statements and other related financial information covering the Non-Reliance Periods should no longer be relied upon.
The corrective adjustments required in accordance with IFRS are expected to be non-cash in nature and will not increase the amount of income tax to be paid in the future. The corrective adjustments are not expected to impact “net revenue,” “operating profit before financial income and tax,” or any other line of statement of profit and loss that is above “profit before income tax" for the Non-Reliance Periods. The corrective adjustments are not expected to impact Adjusted EBITDA for the Non-Reliance Periods or cash and cash equivalents at the end of the Non-Reliance Periods.
The Company intends to file its restated financial statements as of and for the year ended
Description of the adjustments
In 2021 and 2022, the Company completed business combinations, which resulted in book goodwill and income tax deductible goodwill as part of the acquisition accounting. Since
In addition, the amortization of the identifiable intangible assets recognized as part of the Dextra business combination was considered nondeductible in the income tax calculation, which is not consistent with Brazilian income tax regulations. As a result, the income tax expense was overstated by
The Company estimates the net impact of these adjustments will increase Income Tax Expense by approximately
The Company also expects to reflect certain classification corrections to non-derivatives and loans and borrowings as part of the restatement to the financial statements. The reclassifications will reduce current assets in
The Company expects that the restatement described above will be attributable to a material weakness in the Company’s internal control.
The Audit Committee and management have discussed the matters disclosed in this Report on Form 6-K with
A summary of the anticipated impacts on the consolidated statements of profit or loss for the year ended
Consolidated statement of profit or loss (unaudited) (in thousands of Brazilian Reais) |
||||||||
Consolidated statements of profit or loss |
(as issued) |
|
Adjustments |
|
(as restated) |
|||
|
|
|
|
|
|
|||
Profit before income tax |
200,272 |
|
|
- |
|
|
200,272 |
|
Current income tax |
(69,873 |
) |
|
10,303 |
|
|
(59,570 |
) |
Deferred income tax |
(4,483 |
) |
|
(40,509 |
) |
|
(44,992 |
) |
Total income tax expense |
(74,356 |
) |
|
(30,206 |
) |
|
(104,562 |
) |
Net profit for the year |
125,916 |
|
|
(30,206 |
) |
|
95,710 |
|
Forward-Looking Statements
This form 6-k includes forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact that may be deemed forward-looking statements, include, but are not limited to: the statements under Business Outlook, including expectations relating to revenues and other financial or business metrics; statements regarding relationships with clients; and any other statements of expectations or beliefs. The words “believe,” “will,” “may,” “may have,” “would,” “estimate,” “continues,” “anticipates,” “intends,” “plans,” “expects,” “budget,” "scheduled,” “forecasts” and similar words are intended to identify estimates and forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. You should read this press release with the understanding that our actual future results may be materially different from our expectations. These statements are subject to known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by such statements in this press release. Such risk factors include, but are not limited to, those relating to: the completion of our year-end audit process, implementation of corrective adjustments and restatement of our previously issued financial statements, the ongoing war in
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Investor Relations Contact:
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investors@ciandt.com
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