Revolut's 2021 revenues may have been “materially misstated”

2021 was the first year in which Revolut, a neobank founded in 2015, turned a profit. The pandemic and the subsequent boom in cryptocurrencies put Revolut on the map as they registered as an e-money institution; A funding round in the summer of 2021 had the group valued at $33bn.

Revolut reported on Wednesday a net profit in 2021 of £26mn, this is just after a £223mn loss the previous year. Revenues in 2021 almost tripled to £636mn.

However, the group’s auditor, BDO, stated that it had been unable to fully verify £477mn of revenues — including its foreign exchange and wealth department, which includes cryptocurrencies.

Auditors said in their report into the accounts that they had been “unable to satisfy ourselves as to the completeness” of these revenues, meaning that references to the company’s revenues “may be materially misstated”.

BDO said in its recent report on Revolut’s accounts that they (BDO) had to resort to other methods of verifying Revolut’s revenues because it had been unable to rely on Revolut’s IT systems and controls throughout 2021.

It was forced to use those procedures because no reliable documentary evidence of the transactions was produced or maintained outside of the faulty IT system. This approach normally requires an auditor to check millions of individual transactions.