MPs urge finance watchdog to broaden investigation into PwC
TWO prominent MPs have urged the Financial Reporting Council to broaden its investigation into PwC’s auditing of BHS.
Frank Field MP, chairman of the Work and Pensions Committee and Iain Wright MP, chairman of the Business, Innovation & Skills committee have written to the FRC following the announcement last week that it would be investigating PwC over its dealings with BHS.
The pair said in the letter: “We welcome the FRC’s announcement of an investigation into the conduct of PwC with regards to its audit of BHS accounts in the year ending August 2014. We do, however have concerns that the scope of this investigation is too narrow and urge you to consider widening its scope…”
They said that the FRC should be investigating accounts from further back than the year to 30 August 2014 when PwC signed the business off as a going concern.
It was also suggested that PwC’s auditing of other Taveta group of companies with which BHS was interlinked, and that a deadline should be decided upon for the end of the investigation. Mr Field and Mr Wright also said that the FRC needed to prove and ensure the FRC’s independence during the investigation.
Sir Philip Green, former owner of BHS, last week demanded an apology over what he called an ‘outrageous outburst’ from Mr Field with whom he has a long-standing feud, at the joint enquiry last week. It does not appear his requests were answered.
Steve Denison of PwC in Leeds is named as the senior auditor on the company’s 2014 accounts, the last full year it was owned by Sir Philip Green, before he sold it to Dominic Chappell’s Retail Acquisitions for £1.
In them, the company incurred exceptional charges of £26.1m in creating provisions for the future leasing obligations of the company’s loss-making stores.
Mr Chappell owned the business for less than 13 months, and Retail Acquisitions collected at least £17m from BHS.
BHS went into administration in April 2016, putting 11,000 jobs at risk. The business also had a £571m pension deficit.
The Serious Fraud Office is also looking into launching an investigation over the collapse.
