WWE recently found $14.6 million in ‘Unrecorded Expenses’ linked to Vince McMahon.
A new 8-K filing by WWE on July 25 revealed payments totaling $14.6 million linked to former Chairman and CEO Vince McMahon. According to the filing, the payments were paid or will be paid by McMahon personally.
From WWE:
As of the date hereof, the Company has identified Unrecorded Expenses totaling approximately $14.6 million. All payments underlying the Unrecorded Expenses were or will be paid by Vince McMahon personally. While the Company continues to evaluate the impact on previously reported financial statements, the Company has preliminarily determined that, while the amount of Unrecorded Expenses was not material in any individual period in which the Unrecorded Expenses arose, the aggregate amount of Unrecorded Expenses would be material if recorded entirely in the second quarter of 2022. Accordingly, the Company currently anticipates that it will revise its previously issued financial statements to record the Unrecorded Expenses in the applicable periods for the years ended December 31, 2019, 2020 and 2021, as well as the first quarter of 2022, when it issues its financial statements for the second quarter of 2022. The Company is working with the goal of issuing such financial statements by August 9, 2022, but there is no assurance that it will be able to meet this deadline. In light of the Unrecorded Expenses and related facts, the Company expects to conclude that its internal control over financial reporting was not effective as a result of one or more material weaknesses. The Company continues to evaluate the appropriate accounting treatment for the Unrecorded Expenses, as well as its internal control over financial reporting, and its ultimate conclusions on these topics may differ from what the Company currently anticipates.
Vince McMahon announced his retirement on July 22. He is currently being investigated by the WWE board for his alleged role in a million-dollar hush pact linked to sexual harassment claims.
On July 8, the Wall Street Journal revealed new details regarding misconduct allegations against McMahon and showed that their investigation uncovered more than $12 million in payments linked to McMahon. In addition to the allegations against McMahon, the WWE board is also investigating misconduct claims against John Laurinaitis, who was placed on administrative leave in June.
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