Sims Metal Management Limited
(ASX:SGM) has advised the market the carrying value of inventory in its UK business has been materially overstated.
Sims has flagged a write down of the UK inventory in its first half results.
The situation has been identified through control failures and potential fraudulent conduct by local and regional plant management.
The recycling company has formed a special committee of the board to conduct an investigation, which is currently in progress.
Sims says it believes the inventory adjustment will be around $60 million.
Sims Metal Management reported a $521.4 loss in the 2012 financial year.
