PwC fined 10 million pounds by British parliament over misconduct

British lawmakers are pressing the accounting regulator to divulge details of the misconduct that prompted it to slap unprecedented fines on accountants PwC and a former senior partner over a 2014 audit of now-collapsed retail chain BHS.

The Financial Reporting Council (FRC) overnight fined PricewaterhouseCoopers, one of Britain’s Big Four accounting firms, a record 6.5 million pounds ($9 million) and former partner Steve Denison 325,000 pounds over the audit.

PwC’s 2014 audit of BHS signed off the company as a “going concern” days before billionaire retailer Philip Green sold the loss-making group for a token one pound to a serial bankrupt. BHS’s collapse in April 2016 threw 11,000 people out of work and permanently reduced the pensions of 20,000 people.

Frank Field, the chairman of the parliamentary work and pensions committee, said on Wednesday he had asked the FRC whether further investigations into other BHS audits and wider and stronger sanctions were needed.
“On the basis of their reply, the select committee may request the right to appeal to the FRC to significantly increase the fines …,” Field said in a statement.

Although the FRC said PwC and Denison admitted misconduct, it has not given further details. It did not have an immediate comment on Field’s letter.

Denison, a 30-year plus PwC veteran who left the firm in the last few days, has agreed to be barred from audit work for 15 years. A spokesman said he remains a member of the Institute of Chartered Accountants in England and Wales (ICAEW) professional body.

In an open letter to FRC Chief Executive Stephen Haddrill, Field asked why the FRC had not published a report on its findings, whether it had shared conclusions with other regulators, whether it planned to investigate previous PwC audits of BHS and how it had managed any conflicts of interest.