Growing concern

6 Jan 2021 By Aimee Donnellan Follow @aimeedonnellan

Deloitte’s 15 mln pound fine for poor audits of software company Autonomy is light punishment given shortcomings laid out in a new report. The UK’s oversight regime is being overhauled. But doling out heftier bank-style fines is the surest way to shift behaviour.

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Britain’s accounting regulator on Jan. 6 released a 270-page report on Deloitte’s “serious and serial” audit failures of technology company Autonomy.

The accountancy firm was fined a record 15 million pounds in September. Deloitte also has to pay 5.6 million pounds in costs.

Deloitte, one of the world’s Big Four auditors, and two of its now former partners, Richard Knights and Nigel Mercer, were investigated in relation to their audit of Autonomy’s financial statements for 2009 and 2010.

Autonomy, founded by Mike Lynch, was bought for $11 billion by Hewlett Packard in 2011, but the deal turned sour a year later when HP wrote off three-quarters of the former FTSE 100 company’s value, alleging it had been deceived by its finances.

Deloitte said on Jan. 6 it regretted the findings but added that its audit practices and processes had evolved significantly since the work was performed.

Context News

Britain’s accounting regulator on Jan. 6 released a 270-page report on Deloitte’s “serious and serial” audit failures of technology company Autonomy.

The accountancy firm was fined a record 15 million pounds in September. Deloitte also has to pay 5.6 million pounds in costs.

Deloitte said on Jan. 6 it regretted the findings but added that its audit practices and processes had evolved significantly since the work was performed.

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