Corporate Travel, an ASX-listed travel agency founded by Jamie Pherous, found itself in a trading halt following a dispute with its auditor, Deloitte. The company, which provides travel management solutions for businesses and governments, has long been a target of short sellers questioning its accounting practices and share price. Corporate Travel listed on the ASX in 2010. For the first five years, it enjoyed the status of a celebrated founder. But for the past decade, it’s been at war with short sellers and cynics, who have continuously questioned his bookkeeping and the share price that has been guided by the numbers he presents.
The recent announcement revealed that the dispute would delay the release of its full-year accounts and lead to material corrections, raising concerns about the company’s financial reporting. Corporate Travel has since indicated that the potential fallout may be less significant than initially feared, relating to the timing of revenue recognition across different regions. According to the company, previous years’ profits may be adjusted upwards at the expense of this year’s profit, though the full details remain unclear. The company recently switched auditors, replacing PwC with Deloitte, and has engaged KPMG to help resolve the accounting issue.
The situation has reignited the long-running battle between Corporate Travel and its sceptics, a conflict that began in 2016 when Perpetual portfolio manager Anthony Aboud publicly announced his short position in the company. Short sellers have continued to scrutinise the company’s financials, raising questions about its disclosures and earnings. Despite facing challenges such as the global pandemic, Corporate Travel has demonstrated resilience, even making strategic acquisitions during the shutdown. However, questions about its accounting practices persist, leaving the market divided and the future valuation of the stock uncertain.
