{ "docId": "019dd923-622c-750b-8b99-17900a3ad1c6", "docSlug": "4ee8cca82f1a", "documentTitle": "Oatly Group AB (OTLY)", "authorId": "54_Spruce_Point_Capital", "authorName": "Ben Axler", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2021-07-14 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 45, "pageCount": 124, "prevPage": 44, "nextPage": 46, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 0, "notes": "Uses a red flag icon to signal a warning/contradiction.", "elementsJson": [ "headline_text", "callout_box", "quote_block", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b99-17900a3ad1c6/45", "deckHref": "/decks/019dd923-622c-750b-8b99-17900a3ad1c6", "deckJsonHref": "/decks/019dd923-622c-750b-8b99-17900a3ad1c6.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-17900a3ad1c6#slide-45", "components": [ { "bbox": { "h": 0.12, "w": 0.88, "x": 0.06, "y": 0.175 }, "kind": "callout", "text": "Warning: While Oatly does warn investors about a Material Weakness of its internal control over financial reporting, we believe it does not adequately explain the exact impact to its financials. Spruce Point finds evidence that revenues, gross profits, inventory, capex, and employee accounts are inaccurate. Thus, we call into question the accuracy of Oatly’s entire financial statements.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8a59e702-3579-4f9a-962a-609f54e2ec77", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "callout", "text": "While Oatly does warn investors about a Material Weakness of its internal control over financial reporting, we believe it does not adequately explain the exact impact to its financials.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-0397-72dc-a87a-eb2e124711d8", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.88, "x": 0.06, "y": 0.395 }, "kind": "paragraph", "text": "In the course of auditing our consolidated financial statements as of and for the years ended 2020 and 2019, we and our independent registered public accounting firm identified material weaknesses in our internal control environment driven by (i) our technology access related environment and change control processes not supporting an efficient or effective internal control framework, (ii) lack of documented policies and procedures in relation to our business processes and entity level controls as well as lack of evidence of performing controls and (iii) inadequate segregation of duties.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "262afc28-6eef-4bde-8e3d-b35d6a206af9", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.28, "w": 0.88, "x": 0.06, "y": 0.615 }, "kind": "paragraph", "text": "To remedy our identified material weaknesses, we are in the process of adopting several measures intended to improve our internal control over financial reporting, including: (i) implementing formal access and change controls, and making changes to our information technology systems such as implementing new systems and improving the control environment including the reduction of manual tasks; (ii) establishing comprehensive accounting guidelines in relation to our accounting policies, clarifying reporting requirements for, non-recurring and complex transactions, implementing a procedures manual and providing internal training to accounting and finance personnel in relation to policies and procedures, hiring additional accounting and finance personnel, and improving the month-end close process and establishing more robust and formalized processes supporting internal control over financial reporting; and (iii) securing adequate segregation of duties.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "9261e304-8388-47fc-b51a-536c7fc1c221", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "In the course of auditing our consolidated financial statements as of and for the years ended 2020 and 2019, we and our independent registered public accounting firm identified material weaknesses in our internal control environment driven by (i) our technology access related environment and change control processes not supporting an efficient or effective internal control framework, (ii) lack of documented policies and procedures in relation to our business processes and entity level controls as well as lack of evidence of performing controls and (iii) inadequate segregation of duties. — Oatly IPO Prospectus", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-0397-72dc-a87a-eeff35435b88", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.15, "x": 0.06, "y": 0.94 }, "kind": "source-note", "text": "Source: Oatly IPO Prospectus", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8b335f55-670c-4fb0-ad86-058a4010ffda", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.055, "w": 0.365, "x": 0.318, "y": 0.045 }, "kind": "title", "text": "Material Weakness", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "495a4820-03d2-48b6-9f0a-851494da59ab", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "fb18e322-05a3-4709-9a75-f411338e3394", "evidence": "The slide explicitly calls out material weaknesses in financial reporting to question the accuracy of the company's financial statements.", "confidence": 0.9 } ], "arcBeats": [ { "to": 50, "from": 21, "beatId": "5f277d24-b3d8-4aee-a338-e1aabf7fa039", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "The Struggle", "beatSlug": "overcoming-monster-the-struggle", "evidence": "Detailed analysis of Oatly's financials, management structure, and operational issues.", "position": 1, "confidence": 0.8, "parentBeatName": "Development", "parentBeatSlug": "development" } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }