A general meeting of Deutsche Bank
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Deutsche Bank incorrectly disclosed deferred tax assets in its 2019 financial statement which did not meet international accounting standards, the German regulator BaFin said on Tuesday.
“The declarations on deferred tax assets in the consolidated financial statement were not complete,” the regulator, known formally as the Federal Financial Supervisory Authority, said in a statement translated by CNBC.
It said that 2.076 billion euros ($2.26 billion) worth of deferred tax assets had not been disclosed separately in the notes for Deutsche Bank’s U.S. business. The bank should have made the disclosure because it recorded several years of losses, it said.
Additionally, the bank should have explained why it was sure that it would make sufficient profits in the future, which it also did not do, BaFin said.
The disclosure error was against rules laid out by the International Accounting Standards, BaFin said in a second statement.
The findings are the outcome of a random sampling examination, which was initially launched by Germany’s now defunct Financial Reporting Enforcement Panel, the regulator noted.
In a statement to CNBC, Deutsche Bank said the financial statement was still compliant with international reporting standards.
“There is no suggestion on BaFin’s part that there is any inaccuracy in Deutsche Bank’s 2019 accounts, and no restatement or other action is required. It is Deutsche Bank’s view today, as at the time of publication, that its 2019 financial statements and other disclosures comply fully with IFRS [International Financial Reporting Standards] requirements,” a spokesperson for the bank said in emailed comments.
Deferred tax assets are figures on a company’s financial statements that effectively reduce its taxable income in the future, for example related to a previous overpayment or advance payment of taxes.
The disclosure of them is important for transparency about expected future tax implications, BaFin noted.
Europe-traded shares of Deutsche Bank were last down by 0.9% on Tuesday morning.
