Accounting scandal to cost Tesco £129m - ToyNews

Accounting scandal to cost Tesco £129m

The high court has approved a settlement between Tesco and the Serious Fraud Office for accounting irregularities.
Author:
Publish date:
Screen Shot 2017-04-11 at 11.11.24.png

The high court has approved a settlement between Tesco and the Serious Fraud Office that proposes Tesco pay a £129m fine for an accounting scandal.

Sir Brian Leveson approved the so-called deferred prosecution agreement (DPA) at a hearing on Monday. The DPA, allows the company to suspend a prosecution in return for meeting specified conditions, such as paying a fine and demonstrating that its culture has changed.

Tesco has not necessarily admitted fault, as entering into a DPA does not require an admission of wrongdoing.

The DPA relates to allegations of false accounting between February and September 2014 against Tesco Stores Limited, a subsidiary of the retailer.

Tesco admitted in 2014 that it had overstated profits by £326m, triggering a crisis at the company. This overstatement was linked to how it booked payments from suppliers. The ruling means that Tesco will pay out £235m to settle investigations into the 2014 accounting scandal.

As well as the £129m, it has separately agreed with the Financial Conduct Authority to pay about £85m in compensation to investors affected by a trading statement on 29 August 2014 that overstated profits. Tesco will also pay legal costs associated with the agreements.

“I want to apologise to all those affected. What happened is a huge source of regret to us all at Tesco, but we are a different business now,” said Dave Lewis, the chief executive of Tesco in a statement last month.

Related

Featured Jobs

Copyrights Group

Marketing Manager

The Copyrights Group is one of the licensing arms within The Vivendi Group. Acquired by Vivendi in 2016 Copyrights manages the licensing for a portfolio of properties to include Paddington Bear. Some of the other companies within the Vivendi Group include Universal Music Group, and their licensing arm Bravado, Gameloft and Studiocanal to name a few.