Phoenix IT, the managed hosting, cloud and disaster recovery business, has seen a third of its share value wiped off after it admitted a 'mis-statement of a number of accounting balances'.

It said a finance manager at its Servo subsidiary had been suspended while it had brought in accountants PwC and City legal firm Nabarro to conduct forensic investigations into the matter.

The shares plunged 71p to 139.5p.

In a statement, the company said: 'Information has very recently come to light indicating the mis-statement of a number of accounting balances within Servo Limited and its subsidiaries over a number of accounting periods.'

Phoenix estimates that the mis-statements will result in a reduction to net assets of £14m and now expects EBITDA to be between £38m to £44m for the year ending 31 March 2013. Its previous forecast was £48m.

'The group has informed its banks and will keep them abreast of developments. Based on the information to date, the board believes the group is and will remain in compliance with the covenants in its banking facilities and that its net debt and working capital requirements can continue to be provided by the current facilities,' Phoenix added.

In January, Phoenix axed 11% of workforce - around 300 staff - in a restructuring exercise.