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The chief executive of WH Smith has resigned with immediate effect following a scathing independent review by Deloitte which uncovered significant deficiencies in the retailer's North American operations.

The Deloitte assessment revealed "insufficient systems, controls and review procedures for supplier income across commercial and finance functions" alongside "weaknesses in the composition of the finance team" and inconsistent accounting practices within the North America division.

The investigation was launched after WH Smith discovered a major accounting misstatement, a disclosure which slashed tens of millions of pounds from its profits and sent shares plummeting.

The FTSE 250 company announced that a "financial review" had uncovered an overstatement of approximately £30m in anticipated headline trading profit within its North America division, "largely due to the accelerated recognition of supplier income" in the region.

Consequently, the firm confirmed that profit in North America would be revised downwards to £25m from earlier market forecasts of £55m, reducing overall headline profit to £110m, as reported by .

The stock has fallen by nearly 50 per cent since the beginning of the year.

"Whilst the issues identified in the Deloitte review arose in our North American division, I recognise the seriousness of this situation and as Group CEO feel it is only right that I step down from my position," chief executive Carl Cowling said in a statement.

Dan Coatsworth, head of markets at AJ Bell, said: "No chief executive is going to survive an episode as catastrophic as the one that wiped £594 million off the value of WH Smith overnight.