The CFO has left, the PricewaterhouseCoopers audit partner assigned to the company has been placed on administrative leave. So, what happened? Here are the steps:
1. Weak holiday sales in 2018
2. Mattel rejects a takeover offer from Hasbro
3. Mattel’s shares lost half their value over the one-year period that followed.
4. There were problems with the accounting for the company’s Thomas the Train & Friends show.
5. When the valuation issues emerged, the discussion was initially fixing the valuation problem and restating earnings.
6. A earnings restatement was not what Mattel needed at that time and stock price.
7. Senior executives and the PwC audit partner decide to change the accounting treatment without telling the board or CEO what had happened.
8. This is a mess.