Financial audit report
Kering financial audit and Tax investigation
As part of the 2017 tax investigation in Milan, Kering announces that an audit team of the Italian tax authorities has finalized a tax audit and submitted a report today according to which Luxury Goods International (LGI), a Swiss subsidiary of Kering, allegedly carried out activities in Italy which should have given rise to the payment of corporate taxes in Italy, which Kering disputes.
The audit report in question covers the results for the years 2011 to 2017 and the estimated amount of taxable claim is approximately 1,400 million euros.
The audit report must now be examined by the Italian tax authorities by the department responsible for evaluating the conclusions of the report, which will then make its final decision. Kering disputes the conclusions of the audit report both on their bases and the amounts. Kering is confident about the outcome of the ongoing proceedings and will continue to work fully and transparently with the Italian tax authorities to enforce all their rights.
At this stage of the procedure, Kering does not have sufficient information to recognize a specific provision for accounting for a reliable estimate of the recovery risk incurred. The Group also confirms that it rigorously monitors its tax positions and maintains a cautious approach in the assessment of its tax liabilities, particularly those relating to its transfer pricing policy.
Global Luxury Group, Kering brings together and makes grow a set of iconic Houses in Fashion, Leather Goods, Jewelry and Watchmaking: Gucci, Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, Dodo, Qeelin, Ulysse Nardin, Girard-Perregaux and Kering Eyewear. By placing creation at the heart of its strategy, Kering enables its Homes to push their boundaries in terms of creative expression, while shaping sustainable and responsible Luxury. This is the meaning of our signature: Empowering Imagination. In 2017, Kering had close to 29,000 employees and achieved a restated turnover of 10.816 billion euros.