The Financial Reporting Council (FRC), which investigated the auditing of Carillion, has dished out a disciplinary formal complaint against KPMG, one of the firm’s former partners plus some current and former KPMG staff.
The complaint did not relate to the auditing of Carillion’s accounts; rather it was for allegedly providing “false and misleading information” to the FRC as the watchdog conducted its investigation.
A disciplinary tribunal has been convened that will hear the formal complaint and decide whether the firm and various employees past and present conducted misconduct.
KPMG has been widely chastised for failing to identify the warning signs in Carillion’s accounts in the years before the former government contractor collapsed.
As well as facing possible censure from the FRC, KPMG is being sued by the British government.
“We take this matter extremely seriously. We discovered the alleged issues in 2018 and 2019, and on both occasions immediately reported them to the FRC and suspended the small number of people involved,” a KPMG spokesperson said.
“The allegations in the Formal Complaint would, if proven, represent very serious breaches of our processes and values. We have cooperated fully with our regulator throughout their investigation,” the mouthpiece added.
The hearing will start on 10 January.