Apple supplier IQE hires accountancy firm KPMG over ‘accounts manipulation’

Technology company IQE, which makes parts for Apple’s iPhones, on Monday beefed up its defence against claims that it had misreported its profits.

The Cardiff-based chipmaker has hired accountancy giant KPMG to look after its finances after short-seller Muddy Waters, famed for flagging alleged accounting irregularities, accused the business of being an “egregious account manipulator” last week.

It suggested IQE’s true profits in 2015 and 2016 were almost 60% and 25% less than the firm had claimed.

The remarks came after ShadowFall, another short-seller, had said it had “serious concerns” about its profits and sources of cash.

IQE hit back saying the claims were “without merit and misleading” and said Muddy Waters was trying to make money from betting against the company.

Today it added it wants to go “above and beyond” to prove its books are in order. The move is seeking to reassure investors after its shares fell up to 11% last week.

PwC, which had been IQE’s auditor since 2005, added “there were no matters” which needed to be brought to the attention of the board.

IQE, whose technology is part of the iPhone X’s facial recognition sensors, will publish its financial results on March 20.

Its value hit almost £1.4 billion last year, but its shares have almost halved as it has become a prime target for short-sellers alongside retailers Debenhams and Ocado.