12 Jun 2018
Accounting watchdog fined KPMG 3.2 million pounds on Monday for failings in its audit of Quindell Plc, after the legal services firm twice restated its accounts leading to heavy losses.
KPMG and its employee William Smith, who was fined 84,000 pounds, both failed to ensure that Quindell’s financial statements for 2013 and 2014 were free from material mis-statement, the Financial Reporting Council (FRC) said.
KPMG apologised in a statement on Monday for failing to press Quindell’s management harder over the company’s accounts.
“We accept the FRC’s findings that in two specific areas of the audit, our challenge for the year ended 31 December 2013 should have gone further,” a spokesman for KPMG said.
The fine in Britain comes as the global network of accounting firms that make up KPMG is under pressure.
It is facing an inquiry in Britain over its audit of failed outsourcer Carillion and scrutiny of its South African arm’s work for a company owned by the Gupta family.
The ‘big four’ accounting firms, including KPMG, are facing calls to break up into smaller parts from lawmakers in Britain who allege their dominance of the market means they do not sufficiently challenge clients’ claims about their accounts.
Link to Reuters.
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