WPP’s Kantar subsidiary has been accused of deliberately withholding payments to key suppliers in an effort to artificially enhance its balance sheet in the run up to Christmas.
A report in City AM suggested that hundreds of frontline UK staff working for the world’s biggest advertiser were told, by email, to hold off on paying outstanding invoices until the New Year to maintain a healthy balance sheet through the fourth quarter.
An internal email read: “Cash balances are one of the most important indicators there are of the health of a business and so every year WPP looks to maximise its cash position reported in the year-end accounts.”
To achieve this staff are being advised to both step up their efforts to claw back monies owed but also to ‘slow down payments to our creditors’.
It comes after WPP was hit by a string of revenue down grades over the course of the year, leaving management to pin hopes on a stellar final quarter to get the ship back on an even keel.
WPP is a fully signed up member of the government’s Prompt Payment Code which stipulates that suppliers must be paid on time as per the agreement reached at the outset of any contract and has made it clear it follows the letter of the law.