Tui Travel's finance director, Paul Bowtell, has left the business after botched accounting meant the group had to restate last year's accounts.
As a result of running two different accounting systems following Tui's merger with First Choice, the group mistakenly overstated the amount owed to it by £88m because it failed to recognise discounts and fees on bookings. This is on top of £29m of similar items that the group declared in its third quarter results. The write-offs, which have no cash impact, all relate to the UK retail business.
Mr Bowtell was well respected and will be regarded by many as a loss to the group despite the blunder. The group is restating 2009 EPS as 21p, down from 23.8p previously.
The accounting error is clearly not good news, but having updated its systems such a situation should not arise again. Trading, however, has shown a little weakness in October. While the group remains on track to meet expectations, which were downgraded after its August profit warning, booking growth rates have slowed in the last three weeks from 7 per cent to 3 per cent in the UK, from 35 per cent to 17 per cent in the Nordic regions and from 12 per cent to 9 per cent in Germany.
Price: 240p
When: 17 Aug 2010
Change: +13%
