What accounting scandal hit WH Smith?

WH Smith's US unit improperly booked promotional revenues early, boosting short-term profits.

Who resigned from WH Smith due to the scandal?

Chief Executive Carl Cowling resigned last month following the accounting scandal.

How is WH Smith strengthening its board?

WH Smith plans to hire directors with experience in the key US market.

Home / Business and Economy / WH Smith Board Shake-Up Amidst Accounting Scandal

WH Smith Board Shake-Up Amidst Accounting Scandal

14 Dec

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Summary

WH Smith is seeking new directors with US market experience.
Accounting errors in the US unit boosted short-term profits.
Former boss Carl Cowling resigned after the scandal broke.

WH Smith Board Shake-Up Amidst Accounting Scandal

WH Smith is set to reshuffle its board of directors in the wake of an accounting scandal involving its US operations. The travel retailer is actively searching for a new chief executive, as Carl Cowling departed last month. An internal review revealed that the US division had improperly recorded promotional revenues from suppliers ahead of schedule, artificially inflating short-term profits over a three-year period.

The financial blunder resulted in a significant market reaction, with WH Smith's share price plummeting by over £600 million in a single trading day. To bolster its leadership and strategic direction, the company intends to recruit one or more directors possessing crucial experience in the vital US market, which is central to WH Smith's growth ambitions.

Further restructuring is underway, with the leadership team of the North America division under review. The company is expected to release its delayed annual results soon, which will provide more details on the financial impact and ongoing reforms. Former executives may be required to repay performance-related bonuses following the investigation.