Big Four accountant EY quit as Asda’s auditor last summer in yet another blow to its embattled co-owner EG Group, led by brothers Moshin and Zuber Issa.
EY notified the firm of its resignation in July, but Asda had not widely disclosed the exit, including to MPs when questioned last month.
It notified other lenders of its listed bonds in August, according to The Telegraph, which first reported the news.
Asda has struggled with a mountain of debt since the billionaire Issa brothers and TDR Capital bought the company from Walmart for £6.8bn in 2021.
EG Group has recently been selling off assets in an effort to reduce debts and offset inflationary pressures. MPs have raised concerns over the group’s leverage and sprawling ownership model, as well as suggestions it was using Jersey-based vehicles for tax purposes.
An Asda spokesperson told City A.M.: “In a letter last summer, EY confirmed that they would not be able to undertake the enlarged audit – taking into account the acquisition of the EG UK&I business and the significant increase in scale and complexity of the group within the timetable to issue their audit opinion for the year ended 31 December 2023. We notified investors about this on 8 August 2023.”
An EY spokesperson declined to comment beyond confirming that it sent Asda letters of resignation in July and saying its exit was related to “the acquisition of Euro Garages (Jersey) Ltd and the timetable requirements of the audit”.
Fellow Big Four firm Deloitte also quit as auditor to EG Group in 2020 over governance concerns.