Shares in BT Group dived Tuesday after the telecoms and TV group warned that its profits would take a much larger hit than expected on accounting irregularities in Italy.

The company's share price tanked 17.67 percent to 314.95 pence in late morning deals on London's rising stock market.

BT first revealed the accounting errors in October, estimating it would take a hit of £145 million.

But on Tuesday that figure was massively raised to £530 million ($659 million, 614 million euros).

An independent review of its Italian business uncovered improper accounting practices and a "complex set of improper sales, purchase, factoring and leasing transactions", BT said in a statement Tuesday.

"We are deeply disappointed with the improper practices which we have found," said chief executive Gavin Patterson.

"We have undertaken extensive investigations... and are committed to ensuring the highest standards across the whole of BT for the benefit of our customers, shareholders, employees and all other stakeholders," he added.