Ksh.20.6M ‘secret’ deals that saw WPP Scangroup suspend senior executives

Former WPP Scangroup Chief Executive Officer Bharat Thakrar and former Chief Finance Officer Satyabrata Das were suspended over transactions that lacked adequate supporting documents.

New disclosures from the company’s 2020 Annual Report shows unsupported transactions totaling to Ksh.4.8 million in 2020 and Ksh.15.8 million in 2019.

The transactions relate to two parties not previously disclosed including Dimension Data Solutions East Africa Limited and Sequel Holdings Limited.

The transactions have nevertheless been deemed as immaterial to the company but have been booked as other losses in the company’s 2020 financial statements.

The conclusion has also seen the pair of senior executives off the hook on any probable financial misappropriation after an internal investigation.

“The directors do not consider this to be an adjusting event in accordance with International Accounting Standard 10,” WPP Scangroup said in its annual report published on Wednesday.

“The Board has commenced the process of putting in place a detailed remediation plan to ensure that controls within the Group are enhanced to meet the highest standards.”

Further disclosures from the report shows dealings between WPP Scangroup and the related companies were valued at Ksh.72.7 million across 2020 and 2019.

For instance, WPP Scangroup made purchases worth Ksh.13.6 million in 2020 and Ksh.18.7 million in 2019 from Sequel Holdings Limited alongside payments of Ksh.6.7 million in 2019.

Meanwhile, Scangroup had purchases worth Ksh.14.7 million and Ksh.19 million across 2020 and 2019 respectively.

“These companies are related to the Group by virtue of common ownership and/or directorships. These transactions were made on terms agreed between the parties,” added the report.

Bharat Thakrar and Satybrata Das were suspended from the Group on February 18 before resigning from their roles, including as directors of the company on March 23 and May 11 respectively.

This is as the company undertook an internal probe over alleged gross misconduct by the pair.