The Signa Group is short of money everywhere and at some of the more than a thousand companies worldwide, directors are already consulting with lawyers and experts in the field of insolvency law. Financial juggler René Benko resigned as head of the advisory council on Wednesday. He has not held any position as director or board member at Signa for ten years – since a criminal conviction for attempted prohibited intervention. Officially. Unofficially it was clear to everyone that nothing big would happen without him.
Since the massive financial problems became public, the business media across Europe have been asking themselves: How does this opaque Signa thicket of more than 1,000 companies actually work? What do the cash flows look like within the construct? What mutual liabilities and guarantees exist? But above all: why has Signa Holding, the parent company of the Signa Group, never presented a consolidated balance sheet, while billions are being juggled year after year?
To clarify: in addition to the Benko foundations, prominent entrepreneurs such as ex-Strabag boss Hans Peter Haselsteiner and Lindt&Sprüngli president Ernst Tanner are invested in the important Signa holding.
Systematic planning
The answer to this question can be found in a secret document from Benko’s tax consultancy firm, which “News” reports. This 13-page document is also available on krone.at – and shows how Benko systematically planned to make it as difficult as possible for the public to see the Signa cards.
In November 2018, together with tax consultancy firm TPA, great effort was made to avoid a consolidated accounting obligation under all circumstances, i.e. presenting an understandable group picture.
The secret document is formulated in a very technical manner. But even laypeople who have less experience dealing with balance sheets can understand some core principles.
- Right on page 2 it is stated: “The purpose of our recommendations is to avoid a consolidation obligation for Signa Holding with respect to Signa Prime Selection AG (‘Prime’), Signa Development Selection AG (‘SDS’) and Signa Retail GmbH (‘ Retail’) groups. .”
- “Signa Holding should be prevented from even drawing up consolidated annual accounts.”
Therefore, it should be avoided that Benko’s important holding company Signa presents consolidated financial statements year after year, including a management report, as is actually appropriate for billion-dollar companies. Just to better understand, for example, a company like Red Bull has always presented consolidated annual accounts that include all activities of the drinks manufacturer, which is active in more than 170 countries worldwide.
From Red Bull, the interested public not only learns all the financial figures, but also how productive the group was with its 16,000 employees. And how high was the tax payment to the Republic of Austria – most recently over half a billion euros.
Big surprise
At Benkos Signa, even the co-investors in the holding company are now surprised at how dramatically the situation has deteriorated. “We don’t know yet how bad it is,” said Hans Peter Haselsteiner before Benko resigned as a member of the advisory board of “TT”.
That’s surprising. Former CEO Haselsteiner could have asked René Benko all those years why there are no consolidated annual accounts at Signa Holding. Now Haselsteiner has to worry about the millions he has invested.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
