FRC launches investigation into auditing at SIG
Accounting watchdog the Financial Reporting Council (FRC) has begun an investigation into the audit of the financial statements of Sheffield-headquartered SIG by Deloitte.
In an announcement on the markets this morning, the FRC said the investigation would focus on the audit of cash and supplier rebates for the years ended 31 December 2015 and 2016. It will be conducted under the Audit Enforcement Procedure (AEP).
The FRC – the independent, investigative and disciplinary body for accountants and actuaries dealing with cases which raise important issues affecting the public interest – has delegated the investigation to the Institute of Chartered Accountants in England and Wales (ICAEW), which is Deloitte’s Recognised Supervisory Body, in accordance with the AEP.
The AEP procedure applies to the investigation and sanctioning of breaches of the statutory auditors of Public Interest Entities and any other cases retained by the FRC, including AIM companies with a market capitalisation in excess of €200m.
Listed SIG, a supplier of specialist building products in Europe, has a market capitalisation of £812m.
In March, the firm published its annual results the financial year to 31 December 2017, showing the business made pre-tax losses of £51m during 2017; an improvement on the £110m pre-tax losses reported in 2016. Its revenues for 2017 stood at £2.8bn.
Its underlying operating cost base during 2017, excluding the benefits of property profits, increased by £51.2m to £655.9m in 2017 (2016: £604.7m), due to a foreign exchange translation cost of £23.6m, the full year impact of additional costs from 2016 acquisitions of £3.2m, and other cost increases of £24.4m.
At the time, Meinie Oldersma, chief executive, said: “In a year of challenge and change for SIG, I am pleased to be reporting results for 2017 in line with expectations, delivering the first improvement in underlying operating profit for three years, including the benefit of property profits.”
