KPMG UK has settled a £1.3bn legal battle with the liquidators of Carillion.
Liquidators of the collapsed construction firm had been pursuing a claim that KPMG had been negligent in its audits.
They claimed Carillion had been insolvent for more than two years before its collapse at the start of 2018. They argued ‘red flags’ were missed.
The settlement was agreed on Friday, but the details have not been made public.
KPMG made provisions in its accounts for the financial year ending September 2022 for £179m to cover future fines and legal claims costs.
This was a higher figure than provided two years earlier of £92m.
Jon Holt, chief executive of KPMG in the UK, said: “I am pleased that we have been able to resolve this claim.
“Carillion was an extreme and serious corporate failure, and it is important that we all learn the lessons from its collapse.
“The Financial Reporting Council’s ongoing investigation into our work as Carillion’s auditor is an important part of that process, and we will continue to cooperate fully with it.”
KPMG was fined £14.4m last July by the FRC for providing false and misleading information during spot checks on audits of Carillion and outsourcing firm Regenersis.
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Will this mean pensioners who lose out as a result of the accounting miss management will get some compensation from the fine or will it all go to the fat cats.
Shame about all the subcontractors and suppliers who lost money and probably went bust through no fault of their own.