Guardian iT chairman resigns over irregularities

Guardian iT chairman Mr Richard Raworth has tendered his resignation following the discovery of accounting irregularities.

Guardian iT chairman Mr Richard Raworth has tendered his resignation following the discovery of accounting irregularities.

The company said they relate to last year's figures and earlier periods.

Its 2001 operating profit before one-off costs is now estimated to be between £11.5 million sterling and £12.5 million, instead of the £13 million to £14 million indicated last December in a trading update.

Mr Raworth said neither he nor other board members were aware of the irregularities and that: "The board has asked me to remain in place while the current issues facing the business are addressed".

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The irregularities mostly relate to full-year figures for the year to 2000. They will be charged as exceptional costs in arriving at the profit for the year to December 2001 and will have no cash impact.

Finance director Mr Neal Roberts has retained KPMG as independent forensic accountants to conduct a detailed review. To give time for the investigations to be completed, the board does not expect to issue the preliminary announcement of the group's results for 2001 until April.

In addition to the irregularities, corrections of about £1 million to £1.5 million are required to be made to operating profit for 2001. Most of these relate to the last published interim results, which showed operating profit of £8.1 million before one-off costs.

The company has also decided to close its New York office, which will result in the related costs of between £10 million and £11 million being charged in 2002. About £8 million of this total relates to asset write-offs.

PA