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November 29, 2014

Tesco executive under suspension leaves company

The BBC has learned one of the Tesco executives suspended by the company over the £260m profit misstatement has left the company.

Tesco suspended eight executives after its announcement on 22 September that the company may have overstated its profits.

Tesco declined to comment on the departure of the executive. The business is under investigation by the Serious Fraud Office over the guidance error. An internal investigation is being carried out by the accountancy firm Deloitte and law firm Freshfields.

Tesco's chief executive Dave Lewis, who took over from former boss Philip Clarke at the beginning of September, made clear that the suspensions of the executives were not "disciplinary or an admission of guilt".

Falling

How the company could have overstated its future profits by such a sum is not yet clear. In the meantime, billions have been wiped off the value of Tesco's stock market value as a result of the alleged misreporting.

Those suspended include former commercial director Kevin Grace, Carl Rogberg, UK finance director, and UK managing director Chris Bush. Tesco's share price has plummeted 50% in a year as falling sales, boardroom reshuffles, and increased competition from rival supermarkets such as Aldi and Lidl have unnerved investors.

Mr Lewis has refreshed his board with the appointment of Compass boss Richard Cousins and former Ikea boss Mikael Ohlsson as non-executive directors. Tesco still has a 28.8% share of the UK grocery market, according to retail analyst Kantar Worldpanel.

bbc.com

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