UK accounting watchdog probes PwC over Kier and Galliford Try audits
The UK’s accounting watchdog is investigating PwC’s audits of two of Britain’s biggest construction companies.
Big Four accountancy firm PwC is being investigated by the UK’s Financial Reporting Council (FRC) over its audits of construction giants, Kier and Galliford Try, according to The Financial Times.
The FRC’s probe into PwC’s audit of Galliford Try comes after the construction firm was accused of overstating its revenues from the Aberdeen bypass project by £80m in a 2018 interim report.
In response to the claims, Galliford replaced PwC with BDO as its auditor.
In March 2019, construction contractor Kier also revealed it made a £40m accounting error, while using PwC as its auditor.
The mistake saw Kier announce that it was carrying an additional £40m worth of debt, and caused shares in the firm to plummet. PwC continues to audit Kier’s accounts.
If the FRC finds that PwC failed in its duties, the watchdog has the power to impose fines on the auditor, alongside other penalties.
Sources speaking to The Financial Times said PwC will likely seek to settle any case with the watchdog, instead of defending itself at a public tribunal. Any settlement would likely be in the millions, the sources said.
PwC, the FRC, Kier and Galliford have all been approached for comment.