Revolut increased its revenue by 33% last year, riding the crypto wave, but auditors are concerned about the 2021 revenue reports.
According to Reuters, the fintech company Revolut is now profitable, as reported on its long-delayed 2021 reports. The company made a net profit of £26 million ($31.25 million) and tripled its revenue to $765 million.
But Revolut’s auditor, BDO, raised concerns about not being able to verify three-quarters of revenue from 2021. Due to an IT system issue, they cannot confirm the “completeness or occurrence” of £477 million ($573 million) in revenue.
Revolut Resolved BDO Concerns in 2021
BDO believes that some information may be “materially misstated” because the design of Revolut’s IT system did not allow effective testing. The auditor adds, “Verification procedures are not able to provide sufficient appropriate assurance over Revolut’s main revenue generators, which include subscriptions, cards delivery, foreign exchange and wealth.”
The company clarified that the IT issue was “remedied in 2021.” Revolut’s Chief Financial Officer Mikko Salovaara told the Financial Times, “We think that 2021 is a one-off where we needed to do that upgrade. For 2022, we expect a much more normal audit cycle, although it’s still going to be pushed a bit into the first half of the year.”
Revolut should have release accounting reports by last September, but missed the deadline. It also missed a new deadline of December 2022.
Riding the Crypto Wave
The crypto bull market was one of the key factors for Revolut’s increased revenue in 2021, as crypto trading contributed one-third to the business. Revolut became registered as a crypto firm in the United Kingdom and Cyprus last year.
While the company has managed to survive the crypto bear market, with a 33% jump in revenue to £850 million ($1.02 billion), Salovaara did not reveal if they remained profitable.
However, the 2022 accounting reports will answer if the business stayed afloat during the crypto tsunami. Revolut will produce the next set of reports in June.
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