The UK’s Financial Reporting Council (FRC) has fined KPMG, one of the Big Four auditors £6 million over the company’s audit of insurer Equity Syndicate Management 10 years ago. The Council said on Tuesday that it has also issued sanctions against Mark Taylor and Anthony Hulse, former partners at KPMG and Douglas Morgan, a former director of the insurer. The two partners have been fined £100,000 each, FRC said in a statement.
Also, Mark Taylor has been severely reprimanded and has agreed to have a second partner review his audits until the end of next year. Likewise, Anthony Hulse also received a similar reprimand, while Douglas Morgan has been excluded from the Chartered Institute of Management Accountants for two years, the Financial Times reports.
“We are disappointed that aspects of our 2008 and 2009 audits were found not to have met the standards set by our regulator. Since this work was conducted we have changed our insurance audit approach considerably, including how we work with actuaries when auditing insurance claims reserves,” KPMG about the UK fine said.
“The Tribunal accepted that KPMG has taken, and continues to take, steps to improve audit performance and in its last inspection report, the FRC acknowledged our work in this area as an example of good practice.”
The company also added that it will take actions accordingly to put the ‘matters such as this to rest’ as soon as possible.