StockMarketWire.com - Industrial chain supplier Renold said it had delayed its annual general meeting after it identified accounting mistakes in previous results that led to an overstatement of profits.

The accounting glitches were discovered over the three years ending 31 March 2017, 2018 and 2019.

They arose from an overstatement of certain asset values and profit of about £1.8m over the period in the gears unit, which was part of the torque transmission division.

'In order to rectify these issues, the group intends to revise the financial statements for the year ending 31 March 2019, which will be subject to audit by Deloitte,' Renold said.

The company's AGM was meant to take place on 17 July.

The mistakes were identified in an internal review and subsequently confirmed by an independent audit.

The internal audit investigation, supported by PwC, to verify the findings and identify any contributory control weaknesses was ongoing.

'The shortfall in the historical performance of the gears business unit also undermines the ability of this operating unit to make the short-term progress that was originally anticipated,' the company said.

'Hence, expectations for the gears business unit for the year to 31 March 2020 have reduced by £1.1m.'

'Save for the reduction as a result of the revised forecast for gears, outlined above, there are no other changes to the board's expectations for the current year.'

'Whilst continuing to be mindful of uncertain global economic conditions, the board is confident in making further progress with its strategic initiatives.'

'In line with previous guidance, the group's performance will be weighted towards the second half of the year, predominantly as a result of the ramp-up in efficiency at the new Chinese factory, which is progressing well.'



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