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FINANCIAL REGULATORS WILL put supermarket colossus Tesco under the microscope for the accounting blunder which wiped nearly €320 million from the company’s books.
The UK’s Financial Conduct Authority (FCA) will investigate the supermarket giant after the company admitted last week there had been a £250 million (€318 million) “overstatement” in its most recent forecasts.
The announcement slashed its profit expectations nearly 25% below the £1.1 billion (€1.4 billion) it was expecting to make in the first half of the year, a figure which had already been downgraded twice because of its flagging sales.
A full investigation
Ireland and the UK’s biggest supermarket chain this morning told investors it had received news that it would be subject to a “full investigation” from the regulator.
“Tesco will continue to co-operate fully with the FCA and other relevant authorities considering this matter,” the company said in a statement.
Tesco’s shared have plummeted to their lowest level since 2003 on the back of the profit downgrade and the latest Kantar Worldpanel research which showed big sales drops in both its Irish and UK trade.
Tesco Ireland had the largest loss of business of any major chain in the latest figures as German discounters Aldi and Lidl continued to make big inroads into the market.
The company previously announced the suspension of four executives after uncovering the financial mistake and it launched its own, internal investigation.
It has since emerged Tesco had been effectively operating without a financial boss for the six-month period when the error happened.
READ: Tesco position as top Irish supermarket choice is looking increasingly shaky
READ: Companies are too worried about themselves, not enough about jobless: Tesco boss
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If you are going to make a mistake MAKE A BIG ONE
Dislike tesco,their products and staff
It was much more than a mistake though. They made a deliberate decision to book revenue from suppliers at a particular stage. Even if that didn’t break the rules, it’s the sort of aggressive policy that rarely ends well.
And the bigger story is that more than a fifth (possibly even more) of Tesco’s profit comes from payments from *suppliers*. That is only sustainable while you dominate the consumer end. Real trouble ahead.
Me to the staff are rude, unhelpful, surly and they do not smile, continue doing what they are doing when a que is building up and then have an attitude when they have to serve you. I stopped shopping in Tesco a long time ago and would never go back
Aldi people know now every lidl helps!
They should be under the microscope for the outrageous prices they charge.
One of their butchers must have been doing the accounts so
Tesco is sh*t. Their meat is crap, I won’t say the staff are rude, I just don’t think they care. Their prices are absolute nonsense, 30 quid gets you a barely half full bag of shopping – ridiculous!
If you’re not a major fan of lidl or aldi, and sick of Tesco using your hard earned golds to fill their accounting holes then Dunnes is your man!
In fairness Tesco prices are very high, and people just cant afford to shop there anymore, i only go to Tesco for washing powder, and if they have a deal on something other than that wouldn’t go near the place.
You can get everything you want under the tree at Spar
The person who stands up and says, “This is stupid,” either is asked to `behave’ or, worse,
is greeted with a cheerful “Yes, we know! Isn’t it terrific!” FZ
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