Federal Investigation being faced by Under Armour for their Accounting Practices

federal investigation being faced by under armour for their accounting practices

Under Armour Inc. is an American Multinational Company, manufactures casual apparel, footwear, and sports. Under Armour has been facing federal investigation which is led by the Justice Department and also the Securities and Exchange Commission on their accounting practices, which were carried out in their company. From July 2017, Under Armour has been responding to the investigations and are submitting their documents related to accounting practices since then.

Company personnel said that the company is cooperating with both SEC and Federal Dept. and firmly believes that the company was doing their accounting practices rightly. It had been observed that they shifted sales from quarter to quarter to seem to look better, close personnel from the company said. As part of the investigation, the team is questioning people in the company about accounting practices. The SEC and the Justice Dept. are conducting a criminal investigation on the company for more detailed research. On the following statement by Wall Street Journal, neither did SEC nor the Justice Dept. commented on any of it. Under Armour also did face a lot of competition from Lululemon, Nike, and Adidas. Even from North America, the sales dropped by 2% in the year 2018, which was approximately $3.8 billion. The company also changed three Chief Financial Officers (CFO) in the year 2016-2017 and is currently in the middle of a change in its management. Company’s founder and CEO, Mr. Kevin Plank also has decided to step down from his position from 1st January 2020. The new CEO and would be replaced by COO Mr. Patrik Frisk. Kevin Plank does plans to stay in the company as executive chairman and also brand chief of Under Armour.  He also said that the change was part of the corporation’s succession development.

There is also rumors going round the market about Under Amour’s work culture. The company’s staff reportedly charged appointments to strip-clubs on their corporate cards to win over sportspersons. The company’s market stock closed up 2.37% at $21.41 on Friday. Under Amour’s stock is down nearly 11% over the past 12 months.

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