The South African group that owns Poundland has admitted the accounting scandal at the company could worsen.

Steinhoff, which also owns UK retailers Harveys and Bensons for Beds, was plunged into crisis last month after revelations of accounting irregularities linked to its 2016 accounts.

On Tuesday, the firm said although an internal investigation is ongoing, the restatement of the financial statements "for years prior to 2015 is likely to be required", adding that the 2016 and 2015 financial statements "can no longer be relied upon".

Poundland operates seven outlets in Cumbria, with two in Barrow - one on Dalton Road, and another at Hindpool Retail Park - two in Carlisle, and in Whitehaven, Workington and Kendal.

Bensons for Beds has four stores in Cumbria - in Barrow, Carlisle, Workington and Kendal.

In the past month, the scandal has triggered a share price collapse, a management overhaul, lenders deserting the firm and credit insurance being withdrawn from its operating companies.

Last week Steinhoff was again downgraded by ratings agency Moody's, which has warned that it may not have sufficient funds to "sustain its European operations".

Moody's pointed out that Steinhoff has 1.47 billion euro of debt maturing next year, and the investigation into accounting irregularities could "make it challenging to either repay or refinance".

In December, Steinhoff installed an acting chief executive, Danie van der Merwe, following the resignation of Markus Jooste.