Accountancy firm KPMG is no longer working with Tui Travel after discovering a £117 million ‘black hole’ in the travel giant’s UK accounts.
Tui Travel will put a resolution to shareholders at the company’s annual general meeting on February 3 to approve the appointment of PricewaterhouseCoopers as the group’s auditors.
A statement said: “The company has had a good working relationship with its current group auditors, KPMG since the formation of TUI Travel in 2007 and before that as group auditors to First Choice Holidays.
“Following the restatement of the results for the financial year ended 30 September 2009, Tui Travel has agreed with KPMG that it is appropriate that new group auditors should be appointed.”
Notice of the resolution will be posted to shareholders and on the company’s website on January 7 together with the annual reports and accounts for the year ended September 30, 2010.
Tui Travel announced in October that chief financial officer Paul Bowtell had resigned following an audit for the full year ending September 2010 highlighted a further £88 million of irrecoverable balances that needed to be written off, giving a total of £117 million.
KMPG reportedly said its relationship with certain directors became “increasingly strained” following “extensive discussions” with directors.
The firm added that “we are not confident that in the future we could carry out an audit of the company to an appropriate standard but others may be able to do so”.
Chief executive Peter Long said when announcing the restatement of the financial results: “It is now clear that at the time of merger there were weaknesses in the legacy systems we chose to use in the TUI UK business.
“Despite the fact that this situation had built up over a number of years, Paul is behaving honourably and I am disappointed that he will be leaving the group.”
The company has since appointed Will Waggott as chief financial officer for the group.