Bahama Times

Sunday, Jul 03, 2022

KPMG hit by latest in string of fines over Rolls-Royce bribery scandal

KPMG hit by latest in string of fines over Rolls-Royce bribery scandal

The big four auditor will be fined more than £4m for its work on the accounts of Rolls-Royce Holdings dating back more than ten years, Sky News learns.

KPMG UK is facing the latest in a litany of multimillion pound fines for failings in its supervision of the accounts of Rolls-Royce Holdings, the aircraft engine manufacturer.

Sky News has learnt that the big four auditor could be hit with a roughly-£4.5m penalty as soon as this week over work dating back more than a decade.

One source familiar with the situation said the £4.5m was expected to be discounted to reflect KPMG's co-operation with the inquiry led by the Financial Reporting Council (FRC).

The fine relates to the firm's work on Derby-headquartered Rolls-Royce, which in 2017 paid more than £670m to settle bribery charges in the UK and US.

The FRC launched its investigation into KPMG soon after the engineering giant's deferred prosecution agreement with the Serious Fraud Office was announced.

Rolls Royce Trent XWB engines on view on the assembly line at the factory in Derby


"The decision to investigate follows the SFO announcement on 17 January 2017 of a DPA between the SFO and Rolls-Royce PLC which relates to offences including conspiracy to corrupt and a failure to prevent bribery," the accounting watchdog said five years ago.

It is the latest financial penalty to hit KPMG, which has endured a torrid period punctuated by management changes and criticism of its audit work - most notably on Carillion, the collapsed construction company.

KPMG was fined more than £14m this month for misconduct on the Carillion audit.

Among the other audits for which it has been fined have been Revolution Bars and Conviviality, the chain of off-licences.

The FRC and Rolls-Royce declined to comment on Sunday, while KPMG did not respond to several requests for comment.

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