October 29, 2019 / 8:20 AM / a month ago

UK accounting watchdog fines Deloitte partner in Serco Geografix audit misconduct

Offices of Deloitte are seen in London, Britain, September 25, 2017. REUTERS/Hannah McKay/Files

(Reuters) - Britain’s accounting regulator said on Tuesday it had fined Deloitte’s audit engagement partner Ross Howard for misconduct in the audit of Serco Geografix’s 2012 financial statements.

The Financial Reporting Council (FRC) said Howard had been severely reprimanded and will have to pay a discounted settlement of £78,000, ending the regulator’s investigation into Deloitte’s audit of Serco Georgrafix.  

Earlier this year Deloitte and senior partner Helen George were also fined by the FRC for misconduct over the audit.

The penalty comes at a sensitive time as Britain’s government considers how to implement a proposed sweeping reform of auditing, particularly for the world’s Big Four auditing firms - EY, KPMG, Deloitte and PwC.

Serco Georgrafix, a unit of outsourcer Serco, settled a six-year criminal investigation in July this year, when it agreed to pay a fine of £19.2 million and costs of £3.7 million. The fraud related to how it billed the government for electronically tagging offenders.

(This story corrects to make clear the FRC’s fine not linked to the SFO’s settlement with Serco Geografix)

Reporting by Tanishaa Nadkar in Bengaluru; Editing by Shounak Dasgupta

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