Tesco in profits fraud disaster
TOP MANAGER CHRIS BUSH ‘SUSPENDED’ AS SHARES FALL11.5%
Following several complaints to The Slog over the weekend about customers waiting months for cash refunds, an overstatement of profits at the company involving £250m has this morning come to light
Having heard a rumour last Saturday that Tesco was experiencing “some financial embarrassment” I slotted it into the back of my mind, only to remember it as the above exchange took place at the The Slog’s comment thread yesterday. I did a bit of phoning last night, and made a note to follow it up. During the evening two emails arrived here saying they had similar suspicions about Tesco withholding payment.
Now digging has been overtaken by events: Tesco’s managing director Chris Bush was suspended by the company this morning following evidence of a profits overstatement in excess of a quarter of a billion Pounds.
After Richard Brasher’s demise last March, Bush was appointed by Chairman Philip Clarke as “the start of a new generation of Tesco management”. His reign has lasted just six months – and could end up in a rather smaller space than the office he occupied until this morning.
Tesco says its has asked Deloitte to lead an investigation, alongside with the legal firm Freshfields. It is delaying the publication of its interim results by three weeks. New CEO Dave Lewis, admitted that the discovery was a “serious issue”.
The company stated on that the overstatement was “principally due to the accelerated recognition of commercial income and delayed accrual of costs”. And It has emerged in the last few minutes at at least four further senior executives appear to be involved. In English, this means holding back on paying suppliers and shifting income back from the next quarter to make the results look better.
There is rarely smoke without fire. Stay tuned: this one is going to run and run.
The Slogpost that gave the clue: The future is hopefully not the ghastly face of globalists Orange
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