The UK’s accounting regulator is keeping an eye on Tesco’s investigation into accounting errors which has caused more than £2bn to be wiped off its shares in the past two days.
The Financial Reporting Council (FRC) said this morning it is "monitoring the situation closely" after Tesco’s announcement on Monday that it overstated profit estimates by more than £250m.
The regulator has powers in relation to misconduct by accountants and can require a company to restate its financial statements through the Financial Reporting Review Panel, it said today.
It will await the outcome of Tesco’s own investigation to make a decision on whether any action needs to be taken.
The FRC’s statement in full:
The FRC is monitoring the situation following Tesco’s announcement closely. The FRC has disciplinary powers in relation to misconduct by accountants and, through the Financial Reporting Review Panel, can also require a company to restate its financial statements. The FRC does not have powers to monitor or require restatement of unaudited trading statements. It will consider the outcome of the investigation announced by the company and determine whether it should take regulatory action.
Tesco shares continued to slide today, down almost one per cent in early trading this morning.