Former RSM Tenon FD faces £60k fine

The Financial Reporting Council (FRC) has excluded ICAEW member Russell McBurnie, the former finance director of RSM Tenon Group, from the accountancy profession for five years and fined him £60,000 after admissions of ‘reckless’ behaviour, in the final stage of its investigation into the firm’s financial statements

The regulator reported McBurnie has admitted extensive misconduct in relation to the preparation and approval of the financial statements of RSM Tenon for the year ended 30 June 2011. He admitted nine allegations that his conduct fell significantly short of the standards reasonably to be expected of a member of the ICAEW.

These related to the accrual of bonus payments; certain aspects in relation to the recognition of work in progress and amounts recoverable on contracts; the recognition of prepaid fees for the purpose of obtaining IVA appointments; the Econocom Leases; the assessment of the impairment of goodwill; and the preparation of the financial statements on a going concern basis.

McBurnie was found to have breached two of the fundamental principles of the ICAEW code of ethics, including the fundamental principle of integrity which required him to be straightforward and honest in all professional and business relationships because, as he admitted, he was reckless as to whether certain information within the financial statements had been fairly and accurately stated.

McBurnie’s fine has been reduced from £60,000 to £57,000 for settlement, and he is required to pay £825,000 towards the costs of the investigation.

Last August, the FRC fined PwC £5.1m, reduced from £6m on settlement, and gave the firm a severe reprimand for what the regulator termed ‘extensive’ misconduct in the audit of the financial statements of RSM Tenon Group, for the financial year ended 30 June 2011.

ICAEW member Nicholas Boden, senior statutory auditor and audit engagement partner, was fined £114,750 and also severely reprimanded after admitting misconduct.

In 2015, Andrew Raynor, RSM Tenon former CEO and an ICAEW member, was fined £26,400, discounted from £40,000 for settlement and received a reprimand after he admitted misconduct.

The FRC has now published details of those settlements.

Russell McBurnie settlement is here.

PwC and Nicholas Boden settlement is here.

Andrew Raynor settlement is here.

Report by Pat Sweet

Pat Sweet |Reporter, Accountancy Daily [2010-2021]

Pat Sweet was the former online reporter at Accountancy Daily and contributor to the monthly Accountancy magazine, pub...

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