FRC hits Deloitte with latest fine

Sanctions were also imposed on audit engagement partner, Helen George, in relation to the year ended 31 December 2011, following admissions of misconduct.

Deloitte has been fined £6,500,000 (discounted for settlement to £4,225,000) and been severely reprimanded, the FCA said.

The firm will also pay £300,000 towards the costs of the investigation;

Ms George has been fined £150,000 (discounted for settlement to £97,500) and been severely reprimanded;

In addition, Deloitte has arranged for all its audit staff to undergo a training programme (designed to the satisfaction of the FRC) aimed at improving the behaviour that is the subject of the Misconduct.

The regulator said “Deloitte and Ms George failed to act in accordance with the Fundamental Principle of Professional Competence and Due Care”.

A Deloitte spokesperson said: “We recognise and regret that our audit work on Serco Geografix Limited in 2011 and 2012 was below the professional standards expected of us. “We have a programme of continuous improvement for our audit quality processes, which have evolved significantly since these audits were performed. We have also specifically agreed with the FRC certain actions focused on learning lessons from the shortcomings in this audit work.”

The terms of settlement were agreed by the FRC’s Executive Counsel on 7 January 2019 and approved by a legal member of the independent Tribunal Panel.

The Settlement Agreement and the Particulars of Fact and Acts of Misconduct are not published at this time.