LONDON (Reuters) – Britain’s accounting watchdog said on Thursday it had fined PwC 4.55 million pounds ($5.8 million) for failing to challenge management at IT services company Redcentric where a 20 million pound hole was later found in the books.
The Financial Reporting Council (FRC) said it had also required PwC, one of the world’s “Big Four” accounting firms, to supplement the monitoring and support of its audit practice in the northern English city of Leeds.
The watchdog said breaches were numerous and in certain cases basic or fundamental in nature.
Two partners, Jaskamal Sarai and Arif Ahmad, were fined 140,000 pounds each. Both, along with PwC, were given a severe reprimand. PwC also had to publicly declare that its audit reports did not satisfy the relevant requirements.
All fines were discounted to reflect an early settlement of the case that covered audits for the financial years ending March 2015 and March 2016.