Carillion audit probe extended back to 2013
The investigation into the auditing of collapsed construction giant Carillion has been extended to date back another year as the UK accounting watchdog continues its probe.
The Financial Reporting Council (FRC) said its inquiry into the preparation, approval and auditing of Carillion will now also cover 2013.
The FRC is already looking into Big Four accountancy giant KPMG’s audit of Carillion for the years ending 2014 through to 2017.
It comes after the FRC said in January that it had opened a further probe into KPMG’s auditing of Carillion, just days after KPMG suspended partner Peter Meehan, who signed off Carillion’s last full set of accounts, along with three members of his team.
KPMG had acted amid reported concerns that documents provided to the FRC were backdated.
The FRC has already said its original investigations will continue “well into 2019”.
It launched investigations in January and March last year into KPMG’s audits of Carillion, as well as the conduct of two former finance directors, Richard Adam and Zafar Khan.
Under the scope of the investigation, the FRC is looking into the financial performance of Carillion’s major contracts across the construction and services divisions, and whether management and KPMG ensured this was appropriately reported in its financial statements.
Pension liabilities and cash disclosures are also among areas being scrutinised.