Elders says accounting discrepancies in its global cattle trading business can be attributed to a handful of employees and involved falsified documentation and misleading management representations.
Elders on Wednesday said it had received more preliminary findings from accountants PPB Advisory, which it engaged to investigate irregularities related to some cattle trading transactions in fiscal 2012 and the first half of fiscal 2013.
Preliminary findings concluded that the live export trading profits and assets were overstated through non-compliance with Elders' accounting policy and standards.
"PPB Advisory found that the discrepancies were supported by falsified documentation and journal entries and misleading management representations made to senior management and external auditors," Elders said in a statement.
"PPB Advisory has identified evidence that attributes responsibility for the overstatements to a handful of individuals who were then employees of the trading business unit."
Elders said it would consider what action to take against individuals identified as responsible for the irregularities after it receives the final report from PPB Advisory.
Elders announced in October that it had uncovered the discrepancies in the reporting and recognition of livestock values in its live cattle export division.
The company also announced that seven senior employees in the cattle export trading division had resigned.
In November, Elders said there had been an overstatement of profit of about $4.8 million in the live export business during fiscal 2012 and about $20.5 million as at March 31, 2013 (including the $4.8 million in overstated profits for fiscal 2012).
The overstatement in fiscal 2012 appeared to be the result of not recognising losses on livestock sold, and incorrect assumptions related to the fair value of livestock, which did not eventuate.
Elders made bonus payments to a number of employees in the live export business based on the 2012 financial result.
In relation to the fiscal 2013 accounts, losses were "stored" on Elders' balance sheet rather than correctly being recorded in profit and loss.
This included losses due to the decline in the market price of livestock, failure to recognise losses on livestock sales and the cost of keeping livestock on hand.
Shares in Elders were 0.5 cents higher at 11 cents at 1217 AEDT.
