KPMG fined £14.4m by FRC for forging documents in Carillion audit
Consultants KPMG were slapped with a £14.4m fine by the UK accounting watchdog in response to "serious misconduct" on the part of the auditors of failed outsourcer Carillion.
The consultancy's settlement with the Financial Reporting Council was one of the largest ever in UK audit history was triggered by former KPMG staff's forging of documents and after it was found that they misled the regulator, including on the audits of other firms.
KPMG was also facing a "severe reprimand".
Mark Ellison QC, who was representing the FRC, said that: "The misconduct found in this case is extremely serious.
"It cuts at the very heart of the protection of the public interest in the respondents’ regulator, the FRC. It was misconduct deliberately aimed at deceiving AQR inspectors appointed by the FRC."
According to the Guardian, the FRC was provided with misleading information during its audit quality reviews for Carillion and software outfit Regenesis between 2014 and 2016.
The original £20m fine against KPMG was reduced to £14.4m after it cooperated with the regulator and due to its willingness to admit guilt.
The former amount would have exceeded the £15m fine against Deloitte in 2020 for its historic audits of software company Autonomy.