The Financial Supervisory Authority of Norway has issued a decision imposing an administrative penalty of NOK 800,000 on Interoil Exploration and Production ASA following a review of the company’s financial reporting. The authority found material errors in the first-quarter 2024 interim report relating to revenue recognition from a jointly controlled operation and concluded that the subsequent correction in the 2024 half-year report was not performed in line with applicable IFRS requirements. The company recognised 100 percent of sales revenue from a joint operation in Argentina rather than its 51 percent share as required under IFRS 11, resulting in reported Q1 2024 revenue of USD 7.8 million instead of USD 5.3 million. The USD 2.5 million error represented 32 percent of sales revenue and 82 percent of operating profit, and the revised figures changed Q1 operating profit from USD 3 million to USD 0.5 million and the result from a USD 0.9 million profit to a USD 1.6 million loss. The authority also found the half-year reporting did not meet IAS 8 and IAS 34 requirements to restate comparative figures and provide qualitative and quantitative disclosures about the error, including failing to properly inform the market that corrections had been made, and noted that the company did not respond to its December 2024 notice of proposed penalty. The decision can be appealed within three weeks of receipt, with the Ministry of Finance as the appeal body.
Norwegian Finanstilsynet 2025-01-30
Financial Supervisory Authority of Norway imposes NOK 800,000 penalty on Interoil for misstated Q1 2024 revenue and inadequate IFRS correction
Norway's Financial Supervisory Authority fined Interoil Exploration and Production ASA NOK 800,000 for errors in Q1 2024 financial reporting. The company wrongly recognized 100% of sales revenue from a joint operation instead of its 51% share, violating IFRS 11, and failed to meet IAS 8 and IAS 34 requirements in its half-year report. These errors significantly impacted reported revenue and profit figures, and the company did not respond to the authority's notice of proposed penalty.