Mike Ashley’s Sports Direct has announced that Grant Thornton has decided not to seek reappointment as the company’s auditor.
The retailer said Grant Thornton had made the decision subsequent to the publication of its annual report and accounts on Tuesday, and following a “review of its client portfolio”.
Grant Thornton will cease to hold office as auditors of the company with effect from 11 September, the date of Sports Direct’s annual general meeting.
Sports Direct and Grant Thornton said in a joint statement: “As referred to in the chief executive’s report and business Review in Sports Direct’s annual report and accounts for the period ended 28 April 2019, Sports Direct has a longer term aim of looking to engage a Big Four auditor in the future.
“In line with the audit profession as a whole reviewing their client portfolios for, amongst other reasons, audit profitability, during a period of increased regulatory scrutiny, Grant Thornton’s review of its client portfolio alongside Sports Direct’s future intentions on engagement of a Big Four auditor has led to a decision by Grant Thornton to not seek reappointment as Sports Direct’s auditor.
“The board of Sports Direct are comfortable with Sports Direct’s accounts for the period ended 28 April 2019 and believe a fully robust audit was carried out of Sports Direct’s financial statements.”
Grant Thornton has audited the company’s accounts since 2007. Its resignation comes after the release of Sports Direct’s annual results was delayed due to a €674m (£624m) Belgian tax claim.
The Sports Direct Group suffered a 6% fall in underlying EBTIDA to £287.8m in the 52 weeks to 28 April 2019, compared with £306.1m in the same period the previous year. Group revenue at Sports Direct, which also controls Flannels, was up 10% to £3.7bn in the same period.