UK: BDO auditor fired for altering recordsdata earmarked for inspection
October 28, 2022
BDO has fired certainly one of its accountants for tampering with recordsdata earmarked for inspection by UK regulators within the newest case of an auditor dropping their job for retrospectively altering paperwork.
The dismissal follows a £14.4mn high-quality for KPMG this yr after auditors on the Big Four agency intentionally misled regulators by altering audit data throughout inspections of their work at outsourcers Carillion and Regenersis.
The BDO auditor’s interference with the recordsdata was uncovered throughout a routine inspection by the Financial Reporting Council following the audit of an unnamed UK public physique.
The FRC discovered that the auditor, who was a member of workers at BDO however not a companion, made adjustments to the audit file after the regulator notified the agency of the evaluation.
Audit recordsdata, which comprise the proof and dealing papers utilized by auditors to achieve their conclusions a few set of accounts, are typically archived as soon as work is full, that means workers can now not make adjustments.
In a response revealed alongside the FRC’s findings on Friday, BDO stated it had instantly launched an investigation as soon as it discovered concerning the auditor’s actions. “The individual concerned was suspended within three days of the FRC querying the matter with us and dismissed following completion of the investigation,” it added.
BDO, the UK’s fifth-largest audit agency, reported the matter to the Institute of Chartered Accountants in England and Wales skilled physique when it realised what had occurred, stated three folks accustomed to the main points.
The agency stated the auditor had been in a position to make the adjustments as a result of the file had not been archived. This was as a result of its insurance policies on the time didn’t explicitly require the archiving of recordsdata referring to value-for-money assessments, it stated.
Auditors of sure public sector organisations within the UK, together with native authorities our bodies and NHS trusts, should challenge an opinion on whether or not the organisation is securing worth for cash and preserve a separate file on this work.
BDO stated an inner investigation into different recordsdata that had not been archived didn’t discover additional issues. The regulator stated the problem appeared to have been “isolated”.
But the FRC stated it had discovered “significant weaknesses in the audit team’s documentation, archiving and in its engagement with us as a regulator”.
The agency stated the auditor had been in a position to make the adjustments as a result of the file had not been archived. This was as a result of its insurance policies on the time didn’t explicitly require the archiving of recordsdata referring to value-for-money assessments, it stated.
Auditors of sure public sector organisations within the UK, together with native authorities our bodies and NHS trusts, should challenge an opinion on whether or not the organisation is securing worth for cash and preserve a separate file on this work.
BDO stated an inner investigation into different recordsdata that had not been archived didn’t discover additional issues. The regulator stated the problem appeared to have been “isolated”.
But the FRC stated it had discovered “significant weaknesses in the audit team’s documentation, archiving and in its engagement with us as a regulator”.
[The Financial Times]
