PracticeAuditTaking Stock: Spotting accounting flaws is child’s play

Taking Stock: Spotting accounting flaws is child’s play

A secondary school student in Barcelona, spotted discrepancies in Abengoa accounts - apparently overlooked by auditors Deloitte

A 17-year-old schoolboy has achieved what the auditors of Spanish engineering and renewable energy giant Abengoa could not – predict the company’s possible collapse a year ago.

According to reports in The Guardian, Pepe Baltá, a secondary school student in Barcelona, spotted discrepancies in Abengoa accounts – apparently overlooked by auditors Deloitte – as part of an economics project.

“If it does not act soon, there is a strong risk Abengoa will go into bankruptcy,” Baltá wrote in an 18-page analytical report on Abengoa for 2012 and 2013.

“I have some accounting knowledge,” he told El Mundo newspaper, “and Abengoa’s accounts did not seem to add up. There was a lot of debt and few active assets compared to fixed ones. The big surprise was that negative profits were being converted into positives. I didn’t understand how they could do that.”

The troubled outfit filed for bankruptcy protection last month and banks have employed KPMG to examine its accounts to get a clearer understanding of its financial position.

Baltá said neither Abengoa nor Deloitte have tried to recruit him. “I don’t know if it’s because they haven’t heard of me or because they’d rather not have anything to do with an 18-year-old boy,” he said.

Related Articles

Auditors ‘in the dock’ over Carillion as report calls for Big Four break-up

Audit Auditors ‘in the dock’ over Carillion as report calls for Big Four break-up

6d Emma Smith, Managing Editor
PCAOB sanctions former Deloitte Turkey CEOs over altered documents

Audit PCAOB sanctions former Deloitte Turkey CEOs over altered documents

2w Alia Shoaib, Reporter
Big Four dominate FTSE 250 audit market in Q1 rankings

Audit Big Four dominate FTSE 250 audit market in Q1 rankings

3m Alia Shoaib, Reporter
Deloitte to pay $149.5m over Taylor, Bean & Whitaker audit failure

Audit Deloitte to pay $149.5m over Taylor, Bean & Whitaker audit failure

3m Alia Shoaib, Reporter
Deloitte’s audits of Hezbollah-linked bank to be examined by Dubai court

Audit Deloitte’s audits of Hezbollah-linked bank to be examined by Dubai court

3m Alia Shoaib, Reporter
Shareholders bring lawsuit against Steinhoff and Deloitte

Audit Shareholders bring lawsuit against Steinhoff and Deloitte

4m Alia Shoaib, Reporter
BDO replaces Deloitte as Mitie auditor

Audit BDO replaces Deloitte as Mitie auditor

8m Emma Smith, Managing Editor
PwC to take over from Deloitte as Diploma auditor

Accounting Firms PwC to take over from Deloitte as Diploma auditor

9m Alia Shoaib, Reporter