Schroders admits to accounting error

The company is believed to have overstated its total asset management profits, recorded at £149m, by £11m.

Schroders said total asset management profits before tax for 2001 would be as much as 10% lower that market estimates of £70m.

This does not include possible adjustments the board may make arising from the 2000 accounting error or any other provisions which may take place as a result of restructuring or developments at the fund manager.

Schroder’s auditor PricewaterhouseCoopers was paid a £1.1m fee for its work for the year ending December 2000. The firm was also paid £4.1m for non-audit work at Schroders. A spokesman for PwC declined to comment.

Schroders’ shares slumped this morning from an opening price of 915p to 855p at lunchtime today.

Related reading