Animoca Brands hopes to change auditor after warning it must raise money

Animoca Brands, the NFT and Metaverse firm, hopes to pass a resolution at its annual general meeting (AGM) on December 23 that would replace its auditor, DFK Collins, with Hall Chadwick. This is according to the distributed agenda.

Animoca has arguably been slow to file its recent audit reports, not completing its 2020 report until mid-2023. The report included comments from DFK Collins, which noted that for Animoca to “continue as a going concern” would be “dependent upon” it “raising new equity funds” as well as “support from the convertible note holders.” It would also need to “convert cryptocurrencies into fiat currencies as and when required.”

However, despite these comments, it is important to note that DFK Collins also said that its “opinion is not modified in respect” of these matters.

Read more: Animoca Brands has a web3 portfolio worth $1.5B because it said so

At the time of this audit being published, Yat Siu, Animoca Brands’ executive chairman, noted to the Australian Financial Review that the firm didn’t think these issues were “a going concern issue” and added that Animoca has “a reasonable cash position, a reasonable equity position.”

Since the audit period covering through the end of 2020, Animoca Brands has continued to raise money, including:

• On May 13, 2021, the company announced that it had completed a capital raise of US$ 8,888,888.
• On May 28, 2021, the company entered into subscription agreements with “sophisticated and professional investors,” raising US$9.4 million.
• On July 1, 2021, it completed the second tranche in its May 13, 2021 raise, bringing in US$50 million.
• On October 20, 2021, Animoca raised US$80 million from “sophisticated and professional investors.”
• On January 18, 2022, the company announced it had completed a capital raise of US$358,888,888.

An attachment to the AGM agenda notes that Hall Chadwick believes it is “prepared to audit the financial statements for” 2021, 2022, and 2023.

Siu previously told CoinDesk in September of this year that Animoca was “midway through the audit, which is a critical piece of the IPO puzzle” for the firm, also confirming at the time that DFK Collins was conducting that audit.

Protos has reached out to Animoca Brands to see how changing auditors may affect its IPO plans, but at press time had not received a reply.