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So the auditors need more time to audit the results.
Not good
Have you any understanding of how complex an Audit is?
I do and that was for a £500K turnover golf club, we change the constitution remove the audit requirement afterwards.
KPMG may have found a can of worms and will be going through the can worm by worm.
They need to maintain their reputation as auditors.
"KPMG may have found a can of worms and will be going through the can worm by worm."
That's a rather irrational and hysterically grim conclusion to come to don't you think?
It was explained in the prelim results call that in addition to having to work through the accounts of the three separate and newly acquired privately owned businesses, one of these acquisitions in particular, OpenFive was a carve-out from SiFive - this is primarily the reason why the auditing process is even more complicated and time consuming than it would normally be.
Incidentally, SiFive founded in 2017 (same as Alphawave) were said to be worth $2.5 billion in March 2022. It was rumoured Intel wanted to acquire them for $2 billion in 2021. Their core processor products utilise the open source RISC-V architecture which is basically a popular alternative to the ARM type CPU architecture. SiFive and Alphawave will remain active partners while SiFive focus on their core RISC-V business. Alphawave agreed to license SiFive's RISC-V processor IP as part of the transaction for OpenFive .
I doubt there is much cause for concern in the small extension - if it was serious it would be a much more open timescale. I imagine as a new audit, and a technically challenging operation too, the auditors are being very careful to document everything to death.
It is still a bad look though and heightens the management's reputation for over-optimism. They probably can't get to bolshie with KPMG at the moment, but they must be fuming.
My experience as group accountant in dealing with auditors in the past, including KPMG for company sizes circa 20-50m is that auditors will be on site for the audit, will go off happy with everything ticked then wait a few weeks before the sign off/close meeting to bombard you with requests for information critical to sign-off. This generally happens on an easy year where there are no significant changes to the business so I can see how this could happen for a more complex audit without assuming something dishonest going on.
It obviously isn't a great look for the management team with their past history and has added an extra element of risk here that wasn't present beforehand, however, I am optimistic about the results here.
Everyone seems to think this delay ( or 2 delays actually) is perfectly normal and is seen in other companies.
However, I don't think the CFO getting sacked after suspension is normal at all.
I guess everyone can sit around drinking Pimms and consolidating each other while the iceberg approaches!
I'd be interested in people's prediction of sp on the first close after suspension ends.
My guess is 75p
Others can suggest a price also.
I will give you that, that it is not normal for a CFO to step down/ be pushed. We can only speculate here.
We will have the results at the same time to suspension ends, yes? First thing is will be to see if the audited results are confirmed that they give a true and fair reflection of the company's performance and financial health. Providing this is the case then it will be the content of the results themselves. Any bad news on either will tank the stock.
The reason I remain optimistic is due to the narrative from KPMG here : “The principal reason for this is because of the additional procedures required in connection with the first-time audit of the company as an enlarged group following three transformational acquisitions over the past year,”. I personally see a CFO out of his depth rather than anything concerning.
We shall see I guess. Good luck to you all regardless!
This company came to market two year ago at nearly four pounds with big promises. It has failed the investors badly imo.
“ However, I don't think the CFO getting sacked after suspension is normal at all. ”
Oh? Common enough I think you will find.
Look at Carr’s Group, the example I just gave.
Neil Austin was CFO at Carr’s and was stood down from the board on 21st February during the suspension.
I don't know the ex Carrs Group CFO but they are an engineering snd agricultural company.
The AWE CFO was/is a sophisticated individual and is very financially aware.
He's worked mainly in the high end banking industry for big multi national banks.
He left Barclays to come to AWE as CFO.
Some have mentioned he's inexperienced but that simply isn't true.
"The AWE CFO was/is a sophisticated individual and is very financially aware.
He's worked mainly in the high end banking industry for big multi national banks.
He left Barclays to come to AWE as CFO.
Some have mentioned he's inexperienced but that simply isn't true."
As BrokenSmoke said, we can only speculate. I generally agree with your points about Daniel. However, for all of his excellent background and experience in the banking industry particularly in the technology investment sector, he does not have any past experience as a CFO of a public listed company other than the time he's been with Alphawave.
He's still the CFO by the way until the audited results are published.
Alphawave are now looking for an experienced CFO who can carry it through its next phase of substantial growth.