Two senior executives, CEO Ramachandran Ottapathu and Executive Director Ismail Farouk, at Botswana supermarket chain Choppies Enterprises Ltd. are suing former auditors PwC for 653 million rand (~$40 million) for not signing off on the company’s 2018 accounts, which led to a share price collapse. The executives allege that PwC didn’t complete the audit in order to pressure the company to hire PwC director Rudi Binedell as Choppies’s head of finance!
Due to the earnings release delay, the company was suspended from Johannesburg’s stock exchange. Ottapathu was removed from his role, has since been reinstated after E&Y was brought in to look into this and gave him a clean chit.
The stock lost about two-thirds of its value between September 2018 and their suspension on Nov. 1 of that year. The stock is still not trading in South Africa, but was reinstated on the Gaborone Stock Exchange in July.
PwC acknowledged the lawsuit but did not comment further. It will be interesting to see what happens on this lawsuit!