Lookers shares suspended as results delayed by accounting probe
Car dealership firm Lookers today had its shares suspended from trading after failing to publish its final results due to an ongoing accounting probe.
On Monday, the company said it had identified a £19m hole in its accounts after a number of years of overstated profitability.
As a result, Lookers was unable to publish its results for the last financial year before yesterday’s deadline.
It said that it had requested that trading be suspended until it is able to do so, which it said was its priority.
The accounting prove, which has been carried out by Grant Thornton, came about after Lookers identified “potentially fraudulent transactions” earlier this year.
According to an update this week, roughly half of the £19m in the necessary adjustments relates to last year’s results, with the remainder accumulated over a number of years.
Lookers said that around £4m of the adjustments relate to the initial phase of the investigation which focused on one of the group’s operating divisions.
These adjustments include misrepresented and overstated debtor balances in respect of supplier bonuses together with a number of fraudulent expense claims.
Auditor Deloitte has said it will resign as soon as the 2019 accounts are released.
The investigation has triggered a wholesale boardroom shake-up, with five of the firm’s directors, including its chairman, due to step down.
Earlier in the year finance chief Cameron Wade resigned barely a month into his tenure after the transactions came light.
Lookers has also announced that it will make 1,500 job cuts due to the coronavirus pandemic, as well as closing 12 dealerships.