Tesco being investigated by the Serious Fraud Office over profit overstatements
The Serious Fraud Office has confirmed that they have opened a criminal investigation into accounting practices at Tesco plc.
The struggling supermarket chain is already in hot water, with several employees have suspended over the overstating of Tesco’s profits, by an estimated £263 million.
Tesco is already facing one potential investor lawsuit in the US over the accounting irregularities caused by booking deals with suppliers too early.
Britain’s accounting watchdog, the Financial Reporting Council, is also examining how the error came about.
The SFO probe will replace one already being carried out by the Financial Conduct Authority (FCA) which will now be closed.
The company said: “Tesco confirms that it has been notified by the SFO that it has commenced an investigation into accounting practices at the company.
“Tesco has been co-operating fully with the SFO and will continue to do so.
“Tesco has been notified by the Financial Conduct Authority that, in light of the SFO investigation, its investigation will be discontinued.”
Tesco has also been deserted by some of its leading shareholders, including the US-based Harris Associates and Warren Buffett’s Berkshire Hathaway, amid concern over its strategy and the state of its balance sheet.