Following on from the news Tesco has suspended four members of senior managers after finding errors in its accounts, the UK’s financial watchdog has begun a full investigation into the accounting errors that have wiped 4 billion pounds from the supermarkets stock’ market value.
The mistakes, resulting from an early booking of revenue and delayed recognition of costs, were made public on September 22nd. It was revealed Tesco had overstated its first-half profit by 250 million pounds.
The Financial Conduct Authority investigation has resulted in Tesco’s shares going down by a further 3 percent today, which is the lowest since 2003. The regulator is able to prosecute individuals who make deliberate or misleading statements to the stock exchange.
Since the news broke Tesco has appointed tax adviser Deloitte to undertake an independent review of the problems and the supermarket has also launched its own investigation into the issue.
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