Source: Campaign
Publicis Groupe has strongly refuted claims made in a French magazine that it has incorrectly accounted for a settlement agreed with one of its software and IT services suppliers.
The weekly news magazine L’Orbs on Wednesday reported on claims made by Fabrice Rémon, founder of the shareholder activist organisation Gouvernance en Action, that the way Publicis Groupe had accounted for the settlement inflated its results.
In a statement, Publicis Groupe said the dispute was “arbitrated and resulted in a settled resolution, covered by a confidentiality agreement, whereby Publicis Groupe would be compensated for the costs of the delays and difficulties it sustained”.
The compensation was accounted for through a reduction of the book value of the balance sheet assets relating to the project, in part through the neutralisation in the 2014 accounts of the extra costs the delays had caused and in part to cover extra costs in subsequent years as a result of the delays, Publicis Groupe said.
Publicis Groupe did not mention this accounting treatment in the notes to the financial statements for the 2014 or in that year’s annual report as its auditors – who had validated the treatment – deemed it was not necessary to do so.
In its statement, Publicis Groupe said it communicated this information to Rémon and to L’Orbs ahead of publication. It said it reserves “all our rights for any damages that such publications may have on our stock price, the company or our shareholders”.
