Steinhoff crisis deepens as Poundland owner admits more accounts might be wrong

Company said its existing reports for 2015 and 2016 ‘can no longer be relied upon’

The latest developments will deal a sharp blow to a firm already in the throes of a crisis and plummeting share prices (Getty)

An accounting scandal plaguing the troubled owner of Poundland looked likely to deepen on Tuesday, after Steinhoff announced that it may have to restate even more historic accounts than previously expected.

Last month Steinhoff, which also owns Bensons for Beds and Harvey’s, admitted to accounting irregularities linked to its 2016 financial report on the back of which the company’s chief executive resigned.

On Tuesday, the group said that in addition to the investigation already under way, a restatement of its financial reports “for years prior to 2015 is likely to be required”.

It said that investors in Steinhoff are “advised to exercise caution in relation to such statements” as the existing reports "can no longer be relied upon".

The latest developments will deal a sharp blow to a company already in the throes of a crisis. Shares in Steinhoff have plummeted close to 90 per cent since this time last month, as scores of investors have turned their back on the group.

Credit rating agency Moody’s last week slashed its rating for the company from B1 to Caa1, and said that the developments could make it difficult for Steinhoff to repay or refinance around €1.5bn (£1.33bn) of debt that is coming due next year.

A lower credit rating means that a company is deemed less likely to service its debt.

In addition to Markus Jooste resigning at the start of December, South African retail billionaire Christo Wiese, who had been acting as executive chairman for the company, tendered his resignation on 15 December.

Professional services firm PwC is currently conducting the review into Steinhoff’s accounts. On Tuesday the company said that, while “all involved are working as expeditiously as possible, the timeline for completion remains uncertain”.