‘Useless and toothless’ UK accounting regulator fines KPMG £2m for ethical standards breach
A number of SA financial institutions including Absa and Sygnia have cut or diminished ties with KPMG recently, after a spate of revelations in the past 18 months
For KPMG, another week, another rebuke from UK accounting regulators. KPMG was fined £2.1m by the Financial Reporting Council (FRC) following its admission of misconduct on Ted Baker’s financial statements in 2013 and 2014. In addition, a KPMG partner, Michael Francis Barradell, was reprimanded by the regulator and fined an additional £46,800. The misconduct arose from KPMG providing expert witness services to Ted Baker in a London lawsuit, the FRC said. This was in breach of ethical standards and led to the loss of KPMG’s independence in respect of the company’s audits. "Ethical standards are critical in supporting the confidence that third party users can reasonably have in financial statements in circumstances where, of necessity, they only have incomplete information to judge whether the auditor is in fact objective," Claudia Mortimore, interim executive counsel at the FRC, said in a statement. "Where those standards are breached such that the auditor’s independence is lost, use...
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