Groceries Code Adjudicator Christine Tacon has asked Tesco to keep her informed as to the progress of its investigation into last week’s accounting revelations.
Britain’s biggest grocer hit the headlines after admitting it had overstated its predicted half-yearly profits by as much as £250 million. Four executives have been suspended as the fallout from the announcement continues.
Tacon, who was speaking at the PPMA show in Birmingham this week, said she has had discussions with Tesco’s representatives and has requested that compliance with the Groceries Supply Code of Practice (GSCOP) be included in the scope of the investigation. She has asked the supermarket to notify her if any practices are found to have breached the code.
“I will also be meeting their auditors to explain to them the sort of thing I’m hearing about [from suppliers] so that they know what to look for,” she said. “At the end of that process, when I’ve heard what their findings are, I will then take a decision on my next steps, based on the evidence they’ve got.”
Asked whether similar accounting practices were rife at supermarkets and to what extent her office was keeping an eye on it, Tacon added: “Our annual report did talk about things where people were being asked for lump sums for maintenance or future business, and I think one of the arguments is: ‘If I’ve just given you a lump sum for next year’s business, does that go into this year’s accounts or next year’s?’
“I don’t know exactly what’s been found at Tesco, all I’ve had is a conversation about being kept in the picture and making sure they understand the sorts of things I’m looking for.
“I have heard frequently of things being deducted twice, just before a year ends, and being paid back after year end, so these are things I’ve been hearing about.”
See Fridays’ FPJ (30 September) for a full report on Tacon’s PPMA speech.
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