Eddie Stobart Logistics management made it difficult for KPMG to obtain "sufficient audit evidence" as it tried to compile the company's annual accounts, which prompted the accountancy firm to resign as its auditor.
In a formal resignation letter to Eddie Stobart management, sent in November last year, KPMG stated: “Our reason for resigning is due to a breakdown in our relationship with management which followed difficulties in obtaining sufficient appropriate audit evidence during our audit of the company for the year ended 30 November 2017, although that information was ultimately obtained."
The resignation letter was lodged in Companies House on 29 July this year.
Last week Eddie Stobart suspended trading in its shares and chief executive Alex Laffey (pictured) resigned after an accounting investigation found profits had been overstated.
The investigation was launched by chief financial officer Anoop King, who replaced former CFO Damien Harte in March this year.
The company said the investigation, carried out with the firm's new auditor PWC, revealed a £2m error in its 2018 accounts, and that profits for the first half of 2019 would be “significantly lower” than forecast.
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In a stock exchange announcement the company said it would be “applying a more prudent approach to revenue recognition … as well as considering the appropriateness of certain provisions”.
The firm’s half-year results, due for publication on 29 August, will now be delayed until early September.
Laffey, who joined Eddie Stobart in 2015, will be replaced by Sebastien Desreumaux, CEO of the firm’s retail logistics management group iForce and head of contract logistics.
The company, which employs about 6,000 people, remains upbeat about its future.
It said: "The board has full confidence in the ability of Eddie Stobart’s management team to deliver an improved performance for the group going forward, and remains confident in the strength of the underlying business.”
