BT stunned the market in January when it said a complex accounting scandal in Italy had blown a 530 million pound hole in its accounts.

The scandal compounded a slowdown in its British government work and forced BT to cut its forecasts for the next two years.

In its annual report, Britain's biggest telecoms company said it was accelerating the audit tender process to appoint new auditors for the financial year 2018/19 after conducting an internal review and shareholder surveys. (http://bit.ly/2qB8Ryq)

After PwC completes its audit of BT's accounts for the current financial year, KPMG will be appointed as auditor subject to approval by shareholders at the company's 2018 AGM, BT said.

(Reporting by Rahul B and Arathy S Nair in Bengaluru; editing by Jason Neely)