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| BHS collapse inquiry 'should look into auditing' by PwC | BHS collapse inquiry 'should look into auditing' by PwC |
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| MPs investigating the demise of BHS want one of the City’s leading regulators to broaden its own inquiry into the scandal. | |
| The chairmen of the joint parliamentary committee have called for the Financial Reporting Council (FRC) to investigate the work done by the accountancy firm PricewaterhouseCoopers (PwC) on auditing BHS and the rest of Sir Philip Green’s retail empire. | |
| The FRC announced last week that it plans to explore the conduct of PwC during its audit of BHS’s accounts in the year to 30 August 2014, the last full year it was controlled by Green. However, MPs want the regulator to examine the previous years, when PwC audited BHS and the accountancy firm’s audits of other companies in Green’s empire that were interlinked with the collapsed retailer. | The FRC announced last week that it plans to explore the conduct of PwC during its audit of BHS’s accounts in the year to 30 August 2014, the last full year it was controlled by Green. However, MPs want the regulator to examine the previous years, when PwC audited BHS and the accountancy firm’s audits of other companies in Green’s empire that were interlinked with the collapsed retailer. |
| The investigation is likely to focus on why PwC signed off BHS as a going concern when it was reliant on support from its parent company, Taveta, which is the Green family’s investment firm. | The investigation is likely to focus on why PwC signed off BHS as a going concern when it was reliant on support from its parent company, Taveta, which is the Green family’s investment firm. |
| BHS collapsed into administration in April, putting 11,000 jobs at risk and leaving a £571m pension deficit. Green and his wife, Lady Green, controlled BHS for 15 years until he sold it for £1 to a consortium led by Dominic Chappell, who has been declared bankrupt three times. | BHS collapsed into administration in April, putting 11,000 jobs at risk and leaving a £571m pension deficit. Green and his wife, Lady Green, controlled BHS for 15 years until he sold it for £1 to a consortium led by Dominic Chappell, who has been declared bankrupt three times. |
| Green and other investors collected more than £580m in dividends, rental payments and interest during the Greens’ period in charge. Chappell’s consortium Retail Acquisitions then collected at least £17m from BHS, despite owning it for just 13 months. | Green and other investors collected more than £580m in dividends, rental payments and interest during the Greens’ period in charge. Chappell’s consortium Retail Acquisitions then collected at least £17m from BHS, despite owning it for just 13 months. |
| MPs on the work and pensions committee and the business, innovation and skills committee are investigating how the BHS pension scheme ended up heavily in deficit and why Green sold the company to Chappell. Frank Field and Iain Wright, the chairmen of the two committees, said in their letter: “We welcome the FRC’s announcement of an investigation into the conduct of PwC with regards to its audit of BHS accounts in the year ending August 2014. | MPs on the work and pensions committee and the business, innovation and skills committee are investigating how the BHS pension scheme ended up heavily in deficit and why Green sold the company to Chappell. Frank Field and Iain Wright, the chairmen of the two committees, said in their letter: “We welcome the FRC’s announcement of an investigation into the conduct of PwC with regards to its audit of BHS accounts in the year ending August 2014. |
| “We do, however, have concerns that the scope of this investigation is too narrow, and urge you to considering widening its scope to cover previous years when PwC audited BHS financial statements and signed the company off as a going concern, and PwC audits of the accounts of other Taveta group companies with which the finances of BHS were interlinked. | “We do, however, have concerns that the scope of this investigation is too narrow, and urge you to considering widening its scope to cover previous years when PwC audited BHS financial statements and signed the company off as a going concern, and PwC audits of the accounts of other Taveta group companies with which the finances of BHS were interlinked. |
| “We also urge you to set a deadline for concluding your investigation and clarify what steps you intend to take to ensure the FRC’s independence in conducting these important duties.” | “We also urge you to set a deadline for concluding your investigation and clarify what steps you intend to take to ensure the FRC’s independence in conducting these important duties.” |
| The FRC is one of a number of bodies investigating the collapse of BHS. The Pensions Regulator is exploring whether Green should be forced to pump money into the pension scheme, while the Insolvency Service is investigating whether there are grounds to disqualify the directors of the retailer for their conduct. | The FRC is one of a number of bodies investigating the collapse of BHS. The Pensions Regulator is exploring whether Green should be forced to pump money into the pension scheme, while the Insolvency Service is investigating whether there are grounds to disqualify the directors of the retailer for their conduct. |
| The Serious Fraud Office is also considering whether there are grounds to launch a formal investigation. | The Serious Fraud Office is also considering whether there are grounds to launch a formal investigation. |