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The Financial Reporting Council has closed its investigation into PwC over the Tesco (LON:TSCO) accounting scandal.
After two and a half years of probing the supermarket giant’s accounts, the UK financial giant has dropped the enquiry after stating that there was “not a realistic prospect” that the supermarket would be found guilty.
“We co-operated fully during the FRC’s thorough investigation and are pleased that the FRC has closed it without any further action,” said PwC.
In 2014, a £263 million black hole was found in Tesco’s accounts, which then later grew to £326 million due to many incorrect booked payments from the company’s suppliers.
Tesco said earlier this year that it plans to pay a £129 million fine and £85 million in compensation to shareholders to settle a probe by the Serious Fraud Office (SFO).
Carl Rogberg, the former finance director, ex-food commercial director John Scouler, and former UK managing director Chris Bush have all been charged by the watchdog with fraud by abuse of position and fraud by false accounting. The trial is set for September.
Christine Tacon, Grocery Code Adjudicator, said in January 2016 that the supermarket “knowingly delayed paying money to suppliers in order to improve its own financial position”.
PwC was replaced by Deloitte as Tesco’s auditor in 2015.
With further controversy set for the supermarket giant, the UK’s competitions watchdog began its investigation into Tesco’s proposed takeover of food wholesaler Booker (LON:BOK), which owns the Premier, Londis, Budgens and Happy Shopper convenience shop brands last week.
A rebel shareholders from the supermarket is objecting to the deal and told the Telegraph that he has not spoken to a single investor in Tesco who wholeheartedly approved of the £3.7 billion deal.
“My sense is that you have shareholders who are sort of wavering between indifference and outright distaste for the deal, yet most of whom are unwilling to speak up.” he said.