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KPMG has been fined £1.5m for “basic failings” in its audit of advertising firm M&C Saatchi.
KPMG has been fined £1.5m for “basic failings” in its audit of advertising firm M&C Saatchi which emerged following an accounting fiasco in 2019.
Adrian Wilcox, a partner at KPMG, was also fined £48,750 as a result of an investigation by the Financial Reporting Council (FRC), which regulates the accountancy industry.
KPMG was separately fined a record £21m by the FRC last October for “textbook” failures in examining construction giant Carillion’s accounts before it collapsed.
The latest sanction comes after the fiasco five years ago, when M&C Saatchi announced the discovery of an £11.6m accounting error in 2018.
That led to a subsequent removal of board members, including co-founder Lord Saatchi.
KPMG was the auditor in charge of checking the company’s books, with a team led by Wilcox.
KPMG admitted failing to comply with audit requirements, including in relation to one type of payment that inflated revenue by £1.2 million.
The auditor also failed to “complete his inquiries with management” into another aspect of the accounts.