Supermarket giant Tesco today launched an investigation after revealing that its guidance on half-year profits was overstated by about £250 million.
The retailer has asked Deloitte, working closely with legal adviser Freshfields, to undertake an “independent and comprehensive” review of the issues, which involved the “accelerated recognition of commercial income and delayed accrual of costs”.
In its latest profits warning at the end of August, Tesco had said it expected trading profits to be in the region of £1.1 billion.
Chief executive Dave Lewis, who succeeded Phil Clarke at the start of this month, said: “We have uncovered a serious issue and have responded accordingly.
“The board, my colleagues, our customers and I expect Tesco to operate with integrity and transparency and we will take decisive action as the results of the investigation become clear.”
Independent retail analyst Nick Bubb said today’s revelation from the group’s “embattled” management “will go down like a lead balloon in the City”.