London — The UK accounting watchdog is ramping up misconduct fines after being called useless and toothless by lawmakers irate at the failure of the accounting industry to prevent several high-profile corporate collapses. Over two days last week, the Financial Review Council (FRC) levied penalties totaling £14.5m, almost equal to the total fines that the regulator issued in all of 2017. And late on Monday it issued an unprecedented warning that KPMG’s audit work is of an unacceptable standard and the firm will face increased scrutiny. The regulator’s renewed vigour comes as MPs repeatedly complain that lax accounting has contributed to some of Britain’s biggest corporate scandals. In addition to anger at the regulator — which faces an independent review of its effectiveness — there is open speculation in Parliament about breaking up the big four audit firms to increase competition and improve standards. On June 12, the FRC fined PwC a record £10m for its 2014 audits of collapsed dep...

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