UK launches probe into Carillion accountants KPMG

[LONDON] Britain will probe accountancy firm KPMG over its audit work for collapsed construction group Carillion, regulators said Monday.

The Financial Reporting Council has launched the probe after making enquiries about Carillion's July 2017 profit warning, the FRC said in a statement.

Carillion went bust earlier this month, announcing its liquidation after the heavily-indebted company failed to secure a last-minute financial rescue from the government and banks.

"The FRC has decided... to open an investigation under the audit enforcement procedure in relation to KPMG's audit of the financial statements of Carillion," said a statement.

The probe will look at four years of accounting ending in 2017 after the watchdog said it is making "urgent enquiries into the conduct of professional accountants within Carillion".

The investigation will consider whether KPMG has "breached any relevant requirements, in particular the ethical and technical standards for auditors", the FRC added.

Carillion's collapse sparked a major political row in Britain because Prime Minister Theresa May's government signed major contracts with the company after it issued the first of several profit warnings last July.

AFP