This is what happened
The accounting firm PwC has been fined a record £5m due to its auditing of collapsed property group Connaught. It’s also been severely reprimanded.
Connaught employed 10,000 people and had £220m worth of debt when it went under in 2010.
The Financial Reporting Council (FRC) has imposed the fine and spent a total of five years investigating PwC’s audit of Connaught in 2009.
It managed to find evidence of misconduct by PwC and its retired partner Stephen Harrison.
Harrison was fined a total of £150,000 and was also reprimanded.
PwC was also ordered to pay the FRC’s legal fees. It had to make an interim payment of £1.5m as well.
The FRC said the auditors had committed misconduct in three different areas. These were mobilisation costs, long-term contracts and intangible assets.
PwC apologised and added: “Since 2010 when the case began, we’ve worked hard to improve our procedures and processes.”