UK accounting watchdog to study Tesco book-keeping probe
LONDON (Reuters) - Britain's accounting regulator will study the outcome of retailer Tesco's probe into book-keeping mistakes before deciding whether to take enforcement action, it said on Wednesday.
Accounting errors in supplier contracts forced the world's third biggest retailer to suspend its UK boss along with three other senior executives and admit it had overstated expected first half profit by 250 million pounds in a previous trading update.
It has opened an internal investigation.
The FRC said in a statement it does not have powers to monitor or require restatement of unaudited trading statements. Trading updates do not have to be checked by an external accounting firm.
"It will consider the outcome of the investigation announced by the company and determine whether it should take regulatory action," the FRC said in a statement.
The FRC said it has disciplinary powers to punish misconduct by any Tesco staff who are members of a professional accounting body. Staff working in the finance divisions of big companies are often qualified accountants.
UK business secretary Vince Cable has said the FRC could be called in to investigate Tesco if it transpires that "serious malpractice" has taken place.
Tesco has appointed accounting firm Deloitte [DLTE.UL] to review the accounting issues, working closely with Freshfields, the retailer's external legal advisers.
(Reporting by Huw Jones; editing by Jason Neely and Louise Heavens)
