An alleged £15.8m fraud has been uncovered at one of Scotland's largest mineral water companies.

Irregularities were discovered at Campsie Spring Ltd, based in Lennoxtown, following an audit by its parent company Greencore.

The firm, based in Ireland, said there had been a "deliberate concealment of costs" by a former financial controller who, it claimed, had massaged the figures to indicate a higher profit. It is not thought that embezzlement was the motive.

Geoff Doherty, Chief Financial Officer, said: "What we have is a former financial controller of the business who wilfully set out on an exercise since 2006 to deliberately conceal costs to report a higher operating result than the underlying business was making."

Two managers based at the Lennoxtown plant and a divisional head have been sacked following the audit, with legal advice being taken over possible action against the unnamed employee at the heart of the alleged scam.

Mr Doherty said the company's key task had been to "bottom out the financial impact of the issue".

He added that while the board believed the problem was an isolated issue, it was conducting an independent review of all its businesses and auditing processes.

"Apart from adjusting for the impact of this material misstatement, the board, based on current trading, remains confident that it will meet consensus market expectations for 2008," a statement from Greencore added.

Greencore, who bought over Campsie Spring Ltd in 1994, said that its accounts would have to be restated to show a reduction in operating profit by 4m (£3.2m) in 2006 and 8m (£6.4) in 2007. In addition, the alleged fraud is expected to reduce profit by 9m (£7.2m) in 2008.

Financial analyst Paul Meade, of NBC, said Greencore's overall financial position was strong and would "easily weather" the one-off loss of profit, but added it was a setback for management.

"It is likely to weigh heavily on its share price until confidence in Greencore's group wide internal control systems and its numbers are fully re-established, which will take time," Meade wrote in a research note.

Shares in Greencore were trading 17.7% lower at 2.02 (£1.59) yesterday morning, underperforming a 2.9% gain on the wider Irish market.

Greencore specialises in the production of ready meals, including the Weight Watchers range, and is said to be the largest sandwich manufacturer in the UK. It employs 9000 workers across Europe, including 140 at the Lennoxtown plant, many of them Polish immigrants.

Chief Executive Patrick Coveney said it had been "hit hard" by the matter. He said, based on what was found to date, it did not think the former employee had sought "personal enrichment".

Campsie Spring Ltd bottles water from springs and boreholes on the grounds of the Glorat Estate, which has been preserved and maintained by the Stirling family since 1508. The company reached a 99-year agreement with Miss Gloriana Elizabeth Stirling in 1984.

The entire area of the Campsie's from where the water is found is traversed by the Campsie fault, which guides and filters the water through many layers of volcanic rock.