Carillion’s liquidator seeking more than £1bn in damages from KPMG
KPMG may be forced to pay more than £1bn in damages for its role in auditing collapsed construction giant Carillion.
The firm has received a legal claim from the Official Receiver (OR) – the Government agency charged with liquidating the stricken construction giant – requesting the firm pays damages in excess of £1bn, Sky News reported.
The High Court put the OR in charge of liquidating Carillion in January 2018, following its collapse owing close to £7bn.
KPMG was paid £29m to audit Carillion over 19 years and signed off on the company’s accounts nine months before its demise.
In response to the claim, KPMG said in its results this week it has increased the provisions it has saved up to respond to all of the claims it currently faces, from £92m to £144m.
The auditor, which says Carillion’s board and management are solely responsible for the failure as they set the strategy and ran operations, will be forced to recognise the claim today and the document is expected to be placed in the public domain soon afterwards.
A KPMG UK spokesperson said: “We believe this claim is without merit and we will robustly defend the case. Responsibility for the failure of Carillion lies solely with the company’s board and management, who set the strategy and ran the business.”
KPMG’s work for Carillion is separately being investigated by the Financial Reporting Council (FRC), the accounting regulator.
Wolverhampton-based Carillion employed more than 43,000 people, including 18,000 in the UK.