Staff suspended after profits inflated by Â£6m at Sheffield building products giant SIG
Staff have been suspended at Sheffield's biggest company - building products giant SIG - after it overstated profits by more than Â£6m over several years.
An investigation triggered by a whistleblower raised a ‘potential accounting irregularity’ at SIG Distribution, the company said in a statement.
Now, the firm is reviewing ‘clawback’ procedures ‘in relation to incentive payments made to certain individuals’.
In a statement, the firm said it had overstated profit in 2016 of about £3.7m and up to £400,000 in the years before. It had also overstated a further £2.5m profit for the half year to the end of June last year.
SIG has been Sheffield’s biggest company by turnover - more than £1bn - for more than a decade.
A spokesman said the investigation followed a whistleblowing allegation of potential accounting irregularity at SIG Distribution.
He added: “With support from external auditors Deloitte and from KPMG, SIG has conducted a forensic review of the recoverability of a number of balances recognised at 31 December 2016 in relation to rebates and other potential recoveries from suppliers.”
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The findings were presented to the audit committee on Wednesday which confirmed a number were overstated, ‘in some cases intentionally’.
The spokesman added: “The Group is suspending from employment a number of individuals who are being placed under disciplinary investigation into the circumstances surrounding the accounting for these balances and the cash overstatement disclosed in the trading update issued by the Group on 9 January 2018.
The Remuneration Committee of the Board is reviewing clawback provisions in relation to incentive payments made to certain individuals in relation to prior years.”
Expectations for underlying profitability for the year ended 31 December 2017 remain unchanged, he added.
The Group will announce its full year results on Friday March 9.