Ted Baker inventory error swells to £58m

Fashion retailer Ted Baker has revealed its inventory has been overstated by £58m, following an independent review by Deloitte, almost three times the amount originally estimated

At the beginning of December, Ted Baker said it was launching a review of its accounting methods after discovering the value of inventory held on its balance sheet has been overstated by some £20m.

Ted Baker’s auditor KPMG has been in place since 2001, and the audit was last put out to tender in 2012.

The company appointed law firm Freshfields Bruckhaus Deringer to take a comprehensive look at the issues, and subsequently also brought in Deloitte.

In its latest regulatory update, the fashion brand stated: ‘The Deloitte review has now largely concluded and Ted Baker expects to report that the value of inventory held on the group's balance sheet at 26 January 2019 was overstated by £58m.

‘This is materially higher than the £20m-25m preliminary assessment announced on 2 December 2019.

‘As previously stated, the overstatement is a non-cash item and related to prior years.’

The company’s board says it will provide the next update the market at the preliminary results.

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