MHA, a unit of Baker Tilly International, has been publicly censured by the UK Financial Conduct Authority (FCA), marking the first time an auditor has faced such an action from the regulator.
The censure was issued after MHA allegedly failed to meet the required standards for preparing client asset reports on behalf of two regulated financial companies between 2015 and 2019. MHA also neglected to report up to 25 rule breaches by the audited companies to the FCA. “In a first of its kind, this censure underscores the important role that auditors play in providing accurate reports on whether firms are complying with our rules,” said Therese Chambers, Joint Executive Director of Enforcement and Market Oversight at the FCA.
MHA, the UK’s 13th largest accounting firm by revenue, acknowledged the censure and expressed regret for not meeting the required standards. Despite the breaches, the FCA determined that no significant harm resulted, and no financial penalties were imposed. Separately, MHA was also recently fined £120,000 by the Financial Reporting Council (FRC) for breaches in its audit work.
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