American regulators have started an investigation into possible bookkeeping fraud at sports equipment maker Under Armor. According to business newspaper The Wall Street Journal, the company is said to have shifted certain turnovers to other quarters in order to report better sales.
Under Armor denied having made mistakes. The company did say that the American stock market regulator Securities & Exchange Commission (SEC) and the Ministry of Justice are scrutinizing the company. Under Armor has been supplying documents to the federal authorities in connection with its accounting since 2017.
“We collaborate with both investigations and believe that our accounting and disclosures were appropriate,” said a spokesperson.
After 23 years, founder Kevin Plank recently announced his departure as CEO of Under Armor. He is succeeded by Patrik Frisk. Plank still remains the chairman of Under Armor. He founded Under Armor 24 years ago when he played American Football at the University of Maryland. The company grew rapidly in the years that followed and went public in 2005.
In recent years there has been unrest at the top at Under Armor. For example, in the period 2016-2017 the company lost a total of three financial leaders. The company is also experiencing strong competition from groups such as Nike, Adidas and Lululemon, especially in its US home market.