FRC fines Grant Thornton £650k for audit failures
The Financial Reporting Council has fined accounting firm Grant Thornton £650,000 over failures related to the audit of a listed company in 2016.
The regulator also said on Tuesday that it had fined one of Grant Thornton’s partners £20,000.
"The admitted breaches of relevant requirements relate to the audit work carried out on the company’s principal assets, and an area identified as a significant risk," the FRC said.
"The work done on the sampling of those assets was inadequate and failed to select an audit sample that was sufficient to reduce the sampling risk to an acceptably low level. The audit team also placed undue reliance on the company’s externally appointed experts in the valuation of the assets and did not appropriately consider the use of an auditor’s expert."
It said the breaches by the audit team led to a failure to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions about the valuation of the assets. In addition, there were failures to exercise sufficient "professional scepticism" and to prepare adequate audit documentation.
However, none of the breaches of relevant requirements were "intentional, dishonest, deliberate or reckless", the FRC concluded.