Morrisons reports accounting problems
Supermarket giant issues profits warning after problems with Safeway's accounting.
Supermarket giant William Morrison has issued a profits warning on the back of accounting issues discovered in Safeway, the business it bought last year.
Morrisons expects to report profits of between £320m and £330m at next Wednesday’s preliminary results announcement.
The reduction from as much as £390m is due to a ‘review of Safeway supplier balances’ that brought up further issues with Safeway accounting systems during 2004.
As a result of an audit committee meeting held yesterday, the supermarket chain decided to include a £40m provision in the results until ‘the treatment of the debit balances has been determined’.
Morrisons refused to comment further on the profits warning or accounting situation before next week’s earnings announcement.