The Financial Reporting Council has issued a formal complaint against accountancy firm KPMG over audits of companies Carillion and Regenersis.
The formal complaint “alleges misconduct against KPMG and several individuals regarding the provision of allegedly false and misleading information and/or documents to the FRC by KPMG in connection with the FRC’s inspections of two audits carried out by KPMG”, according to the FRC.
This includes the audit of the financial statements of Carillion plc for the period ended 31 December 2016 and the audit of the financial statements of Regenersis plc for the period ended 30 June 2014.
The individuals to whom the formal complaint has been delivered include Peter Meehan, the engagement partner for the Carillion audit, and Stuart Smith, the engagement partner for the Regenersis audit.
The audit – and preparation – of the 2016 Carillion financial statements are the subject of separate investigations, as announced on 29 January 2018 and 19 March 2018 respectively.
The FRC’s investigation was opened in November 2018 after KPMG had self-reported certain matters relating to the review of the 2016 Carillion audit. The scope of the investigation was expanded in July 2019 to include the inspection of the 2014 Regenersis audit after KPMG had self-reported certain matters relating to that inspection.
A disciplinary tribunal has been convened to hear the formal complaint and determine whether or not the respondents have committed misconduct. This hearing is scheduled to start on 10 January 2022.
The construction and facilities service giant Carillion plc dramatically collapsed in January 2018.