KPMG called to account – again

Accountancy giant KPMG has been hit by more than £8million of auditrelated fines since 2014.

The latest penalty came yesterday when industry regulator the Financial Reporting Council punished the firm over mistakes involving one of its customers, fashion chain Ted Baker.

KPMG, which had audited Ted Baker’s accounts since 2000, was asked by the firm to help with a legal case brought against its insurers.

KPMG was paid nearly £1m for the work. But the FRC said doing this while auditing Ted Baker’s accounts was wrong. KPMG was fined £3m, cut to £2.1m after the firm cooperated. A fine against Michael Barradell, a senior statutory auditor, was reduced from £80,000 to £46,800.

KPMG and senior staff have been fined £8.4m for audit-related issues over the past three years. Its reputation has been hammered over links to company scandals, including Carillion’s collapse. KPMG said: “We are committed to upholding the highest standards of independence and regret that in this instance our processes fell short.” Critics now say KPMG, along with big rivals PwC, EY and Deloitte, are too powerful.