Retailer accounted for millions of pounds of non-existent stock
By Sarah Wood | 2nd December 2019
High end fashion retailer Ted Baker may have overstated the value of its stock by as much as £25m.
Law firm Freshfields Bruckhaus Deringer will look into the situation and independent accountants will also be appointed to investigate, as reported by the BBC.
Following the news, shares in Ted Baker, which has a store in Gloucester Quays and a concession at Cavendish House in Cheltenham, fell by 10 per cent.
The mix-up comes at the end of a challenging year for the company. Earlier this year, Ray Kelvin, who had been chief executive since the company's launch in 1988, stepped down over misconduct claims.
Meanwhile, sales and profits at Ted Baker have tumbled this year. In October, the retailer reported a £23m loss for the six months to 10th August, down from a profit of £24.5m last year.
In this latest setback, Ted Baker said it may have accounted for up £20m to £25m of stock on its balance sheet that did not exist. The company said that it did not expect there to be a cash impact from the overstatement of inventory.
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