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Tesco crisis worsens as fifth executive is suspended


The Tesco crisis has worsened as they have been forced to suspend a fifth senior executive, pending the results of their investigations.

An investigation into the company’s finances was recently instigated by the discovery of a £250m black hole in their accounts.

The latest executive to be suspended is Kevin Grace, who is the commercial director of the group, and the head of the part of the company that is at the centre of the scandal.

The financial black hole was brought to the attention of new chief executive Dave Lewis, by a whistle blower. It was revealed that the Tesco commercial team had reported income from suppliers earlier than they should have, whilst they also pushed back the reporting of costs.

As income and expenditure were reported at incorrect times, the expected profit for the first six months of the year was artificially inflated by £250m.


Tesco’s accounts are now being investigated by Deloitte and Freshfields, but Mr Grace will not be a part of the company whilst the investigations are taking place.

The other executives who have been told to step aside, pending the results of the investigation are:

- Chris Bush, UK managing director
- Carl Rogberg, UK finance director
- John Scouler, food commercial director
- Matt Simister, head of food sourcing

Robin Terrell who is the multi channel director of Tesco, has taken the over the managing directors duties on an interim basis.

However, depending on the results of the investigation, it remains unclear what the suspended executives future roles will be at the company.

In the meantime, Tesco have appointed two new non-executive directors to the board. The new non-executive directors are Richard Cousins and Mikael Ohlsson, who have both worked as chief executives at large companies.

Mr Cousins is the current chief executive of catering Group Compass, whilst Mr Ohlsson is a former chief executive for IKEA, and both will join Tesco on the 1st November 2014.

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