Tesco seeks new auditor after accounting scandal

Wednesday, 13 May 2015 00:58 - - {{hitsCtrl.values.hits}}

LONDON, (Reuters): Tesco, Britain’s biggest retailer is to seek a new auditor after ending its 32-year relationship with PwC following an accounting scandal.

PwC has been Tesco’s auditor since 1983 but its auditing of the supermarket’s 2014-15 accounts will be its final act for the company.

“We have issued an invitation to tender for the appointment of an auditor. Taking into account the term for which PwC has served as auditor, we have agreed with them that they will not participate,” Tesco said in a statement.

Tesco said in September it had overstated first-half profits by 250 million pounds ($ 385 million) due to incorrectly booking payments from suppliers, a figure it later raised to 263 million pounds.

The scandal led to the suspension, then exit, of several senior executives, and sparked investigations by Britain’s Serious Fraud Office (SFO), accounting watchdog the Financial Reporting Council (FRC) and a grocery industry watchdog. It could also prompt investor lawsuits both in Britain and the United States.

Tesco’s new chief executive Dave Lewis has since changed the retailer’s relationships with suppliers.

PwC declined to comment.

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