Accounting scandal wipes 20% off BT’s shares

BT’s share price fell by almost 20% last Tuesday, after an update on an accounting scandal in its Italian business led to a profit warning.

BT's share price fell by almost 20% last Tuesday, after an update on an accounting scandal in its Italian business led to a profit warning, and the resignation of the head of its European operations. BT admitted last October that it had uncovered "historical accounting errors". It wrote down £145m, and most of the Italian unit's management were ushered out of the business.

But this week BT said that the extent and complexity of "inappropriate behaviour" was "far greater than previously identified". BT increased its writedown to £530m, and said revenue would be down by £200m a year for the next two years.

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Ben Judge

Ben studied modern languages at London University's Queen Mary College. After dabbling unhappily in local government finance for a while, he went to work for The Scotsman newspaper in Edinburgh. The launch of the paper's website, scotsman.com, in the early years of the dotcom craze, saw Ben move online to manage the Business and Motors channels before becoming deputy editor with responsibility for all aspects of online production for The Scotsman, Scotland on Sunday and the Edinburgh Evening News websites, along with the papers' Edinburgh Festivals website.

Ben joined MoneyWeek as website editor in 2008, just as the Great Financial Crisis was brewing. He has written extensively for the website and magazine, with a particular emphasis on alternative finance and fintech, including blockchain and bitcoin. 

As an early adopter of bitcoin, Ben bought when the price was under $200, but went on to spend it all on foolish fripperies.