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Tesco in Crisis

Infinity
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Tesco in Crisis

“There are two types of chancellor,” Gordon Brown used to joke. “Those who fail and those who get out in time.”
Tesco’s former chief executive, Terry Leahy, now enjoying a lucrative career as a feted business guru, got out in time.
The irony is that many of the problems now bringing the retail giant low are a legacy of the strategic decisions he made.
http://www.theguardian.com/business/live/2014/sep/22/tesco-launches-inquiry-after-overstating-profit...
http://news.sky.com/story/1340172/tesco-eight-chinks-in-supermarket-chain
http://www.bbc.co.uk/news/business-29306444#sa-ns_mchannel=rss&ns_source=PublicRSS20-sa
http://www.dailymail.co.uk/money/news/article-2764887/Tesco-shares-plunge-10-supermarket-giant-finds...
And all over the Broadcast News
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Re: Tesco in Crisis

£250  million is a lot of money to mysteriously loose!
Makes you wonder who can't use the calculator in a company full of automated accounting machines  Cheesy
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Infinity
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Re: Tesco in Crisis

I don't think they actually lost the money, just manipulated internal reporting dates to make the P&L look more impressive.
The errors emerged during the company's preparations for half-year results, which will now be announced on October 23 rather than October 1.
More info here..
Quote
Tesco has identified an overstatement of its expected profit for the half year, principally due to the accelerated recognition of commercial income and delayed accrual of costs.
In other words, the reporting of costs incurred in the first half of the year appears to have been delayed so they are pushed into the second half, while profits enjoyed during the second half of the year appear to have been brought forward into the first half.

http://news.sky.com/story/1340272/tesco-profit-error-could-something-be-amiss


Community Veteran
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Re: Tesco in Crisis

So somebody wanted a big fat bonus / pay rise and so they played the numbers game...  Roll eyes
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Community Veteran
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Re: Tesco in Crisis

There is a saying that if you pay peanuts then you get monkeys.
Seems that despite the top pay they might as well have employed monkeys.
NB: With apologies to all the monkeys out there.
Community Veteran
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Re: Tesco in Crisis

Quote from: gleneagles
NB: With apologies to all the monkeys out there.

Grin Grin Grin
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Infinity
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Re: Tesco in Crisis

Community Veteran
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Re: Tesco in Crisis

Well apparently (according to C4 news) they were former bankers.
Three guesses about their guilt with the profits being rigged  Roll eyes
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itsme
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Re: Tesco in Crisis

Common practise having bonuses linked to share prices so everything that keep the share price high will be done.
Infinity
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Re: Tesco in Crisis

Tesco rushes in new finance director to deal with accounting scandal
http://www.theguardian.com/business/2014/sep/23/tesco-finance-director-accounting-profits

The Serious Fraud Office and the Financial Conduct Authority have said they are keeping a close eye on developments at the troubled chain.
http://www.dailymail.co.uk/news/article-2766306/Tesco-crisis-national-issue-affects-British-business...
nanotm
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Re: Tesco in Crisis

the problem with allowing bankers to run accounts is they don't care how they fudge the figures so long as they get that super fat bonus, then once its too late to fix the problems they walk into the bosses office and declare that 20 billion seems to have gone missing overnight .....
just because your paranoid doesn't mean they aren't out to get you
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Re: Tesco in Crisis

andy will be along to tell us everything is fine business is business.
TORPC
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Re: Tesco in Crisis

It seems that they are advertising Job opportunities

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Re: Tesco in Crisis

Quote from: chrcoluk
andy will be along to tell us everything is fine business is business.

I don't like the retail sector generally - margins are too low.
Quote from: nanotm
the problem with allowing bankers to run accounts is they don't care how they fudge the figures so long as they get that super fat bonus

Bankers don't run the accounts and we have auditors to scrutinise the accounts (but not the projections).
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Re: Tesco in Crisis

Quote from: 7up
Well apparently (according to C4 news) they were former bankers.

Not sure who the bankers were - it would certainly be an unusual career move.
The overstatement of the expected profit came from their commercial income (e.g. commercial discounts & rebates from suppliers) and delaying cost accruals. The fact that they've replaced their UK head of the grocery business is an indication that this is their line of business that was the source of the problem.