KPMG ‘in advanced talks’ with regulator over record fine for Carillion audit failings
KPMG is in advanced talks with regulators about a record fine for failings in its auditing of Carillion, the construction company which collapsed in 2018.
Sky News is reporting that discussions between the accountancy firm and the Financial Reporting Council (FRC) are close to being finalised, with an announcement possible in the coming weeks.
It is understood that the two sides had been negotiating penalties of between £25m and £30m, before the application of a discount on the basis of KPMG’s co-operation with the probe.
After the discount is applied, the total fine is expected to land in the region of £20m.
KPMG has already been hit with a massive fine over its role in the Carillion scandal.
In July last year, the firm had a £14.4m sanction imposed on it for misleading the FRC during spot-checks on its audit of the construction group and Regenersis, an outsourcer.
Earlier this year, KPMG and the Official Receiver agreed to settle a £1.3bn claim on behalf of Carillion’s creditors alleging negligence on the part of the audit firm.
Carillion went bust owing close to £7bn. It employed more than 43,000 people, including 18,000 in the UK.
KPMG served as Carillion’s auditor for almost two decades, earning a total of £29m for its audit work.