The British government estimates at 64 million pounds in total, in addition to the fine, the sums to be recovered from the operator.
The British audit regulator, the FRC, announced on Tuesday the opening of an investigation targeting the firm Deloitte for its audits of the accounts of the British transport group Go-Ahead, whose publication of the results had been delayed due to the setbacks of one of its subsidiaries. The FRC”opened an investigation into Deloitte’s audit of Go-Ahead Group’s financial accountsfor the fiscal year ending July 2021 and the five previous fiscal years, the regulator said in a statement, without giving further details.
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The group had been affected at the beginning of the year by the troubles of the railway company London & South Eastern Railway, of which it owns 65% alongside the French Kéolis, which owns the remaining 35%. The government had not renewed the franchise contract of this subsidiary in September because of a debt of 25 million pounds towards the British taxpayer. Go-Ahead’s annual results, which were originally due to be released by January 3, could not be released until February 24, with the company and Deloitte explaining that “more time (was) needed to finalize the financial accounts auditbecause of this case. The group’s shares had therefore been suspended for almost two months on the London Stock Exchange.
More than 25 million pounds hidden between 2014 and 2020
London & South Eastern Railway, which served the British capital and south-east England, was also fined 23.5 million pounds by the British government in mid-March. Between October 2014 and March 2020, the company “had deliberately concealed over £25m of taxpayer fundingBritish, linked to the HS1 high-speed line (borrowed in the south-east of England by Eurostar), had explained the government.
Go-Ahead’s action suspended following accounting problems at its subsidiary
This amount “should have been returned to the taxpayer“, According to the executive, who says he also noted shortcomings in a previous franchise agreement. The government estimates at 64 million pounds in total, in addition to the fine, the sums to be recovered from the operator. The group acknowledged in September that “mistakes (had) been madeand apologized to the Ministry of Transport. Deloitte said on Tuesday “cooperate fully with the FRC’s investigation“, in a statement sent to AFP. The firm added that it is committed to “adhere to the highest audit quality standards“.
The audit sector in the UK is in the crosshairs of the government, pointed to having failed to see emblematic bankruptcies coming in recent years: those of the chain of stores BHS in 2016 (PwC), of the construction company Carillion in 2018 (KPMG) and tour operator Thomas Cook in 2019 (EY).