ACCOUNTING PROBLEMS FORCE IRB TO RESTATE 2019 INCOME DOWNWARD

Brazilian reinsurer IRB Brasil Resseguros has restated its 2019 earnings downward by 31% to 1.2bn reais ($220m) owing to accounting irregularities. The company launched an internal investigation into its accounting practices after investment firm Squadra Investments issued a report about the irregularities in February and shorted IRB’s stock. IRB vice-president of compliance Wilson Toneto said on a conference call the group will sue former executives over improper bonuses they received. The company announced last week that it uncovered the source of false reports that Berkshire Hathaway had made an investment in IRB. In early March, IRB’s shares lost 41% in value after Berkshire denied the reports. IRB has hired Banco Bradesco and Itau Unibanco to bring its capitalisation into compliance with levels demanded by insurance regulator Susep.