Shares plunge 16% as firm suspends two managers amid probe into financial irregularity at slate business
Support services group Alfred McAlpine has uncovered a potential fraud at its slate subsidiary which will cost it at least £24m.
The company said today that an investigation by its internal audit team had uncovered “a systematic misrepresentation of production volumes and sales for a number of years” by senior mangers at the subsidiary.
The news caused the company’s share price to plummet more than 16% to 513p per share by 9.05am this morning.
It believes the discovery will involve decreasing the value of the 2005 net assets by £11m and a reduction in expected pre-tax profit of £13m for the year ending 31 December 2006. However Alfred McAlpine warned that the accounting irregularities could impact on future results.
Aflred McAlpine has already suspended two senior managers from the slate business pending further investigation. It has also put in place an interim management team reporting directly to chief executive Ian Grice.
The company has also appointed independent accountants to examine the slate division’s books since 2003.
The investigation means Alfred McAlpine’s results have been delayed to 30 April at the latest.