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New WH Smith Chief to Tackle Troubled US Stores
1 Feb
Summary
- New boss Leo Quinn to review troubled US division.
- US profits overstated by £30 million due to early booking.
- Auditor PwC faces scrutiny over approving accounts.
WH Smith is preparing for a comprehensive review of its operations, spearheaded by its incoming executive chairman, Leo Quinn. Quinn, a veteran of corporate turnarounds, will prioritize an examination of the company's struggling US division. This strategic review comes in the wake of an accounting scandal that significantly impacted the company's share price.
The core of the issue involves the overstatement of profits in the US by £30 million, stemming from the premature booking of income from suppliers. This accounting irregularity has placed WH Smith under investigation by the Financial Conduct Authority.
Quinn's leadership is expected to guide the company through this challenging period. The review will likely involve scaling back the US business, which was expanded through acquisitions. Meanwhile, the company's auditor, PwC, which has overseen the accounts for over a decade, is facing significant criticism and potential inquiry for its role in approving the financial statements prior to the scandal's discovery.
