Analysts are continuing to wrangle over Tesco's accounting policies after ABN Amro analyst Mark Wasilewski again rattled investors with a second research note suggesting Tesco's accounting policy had inflated earnings per share by up to 10%. Wasilewski perplexed many City commentators last month by issuing a "sell" recommendation on Tesco. The dispute centres on why Tesco's depreciation charge relating to fixtures and fittings has not risen very much in the last few years considering the book value of Tesco's assets has risen considerably. Most analysts agreed the falling depreciation rate was "odd" but were largely satisfied with Tesco's explanation. Tesco said fully depreciated assets would not be included in the depreciation charge but would still be included in the gross asset value, while fittings bought recently for overseas lasted longer and depreciated at a different pace. One analyst said Wasilewski had raised an important point and then "flogged it to death," while the true flattery' of earnings per share was probably closer to 2-3%, "within the margin for error of modelling anyway". {{NEWS }}

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