Disciplinary Tribunal Report following sanctions against KPMG LLP and others in connection with Audit Quality Reviews of Regenersis & Carillion audits
News types: Inspection, Investigations, Publications
Published: 27 September 2022
The FRC has today published the report of the Independent Disciplinary Tribunal detailing its findings of Misconduct by KPMG LLP (KPMG) a former KPMG partner and four former KPMG employees (the Respondents), following an investigation undertaken pursuant to the Accountancy Scheme. The investigation related to the provision of false and misleading information and documents to the FRC in connection with the FRC’s Audit Quality Reviews of two audits carried out by KPMG: the audit of the financial statements of Regenersis plc for the period ended 30 June 2014; and the audit of the financial statements of Carillion plc for the period ended 31 December 2016.
The FRC announced the Tribunal’s Misconduct findings and sanctions on 25 July 2022 .
The Tribunal Report, which has been edited for publication, details the reasons why the Tribunal considered the Misconduct which included findings of dishonesty on some matters and findings of lack of integrity on others, to be serious. It sets out the detail of the Tribunal’s conclusions on the facts and evidence which underpin its findings of Misconduct against each individual. It also explains the Tribunal’s approach and its reasons for arriving at the sanctions which it considered appropriate to impose on the Respondents in the circumstances of this case.
The Report describes as impressive KPMG’s actions on identifying the issues which gave rise to the proceedings. These actions included bringing the matter to the attention of the FRC, following consultation with the FRC conducting three separate reviews at an early stage, admitting responsibility for the acts of the individuals, and later admitting in advance of the Tribunal hearing that Misconduct had occurred and expressing contrition. These strong mitigating features served to reduce the sanctions that might otherwise have been imposed on KPMG.
Tribunal report