FRC ends part of Mitie investigation

The Financial Reporting Council (FRC) has closed one element of its probe into accounting issues at FTSE 250 outsourcer Mitie Group, having concluded there is insufficient evidence, but is continuing its separate investigation into Deloitte’s auditing of the company

The regulator said it has ended its investigation under the accountancy scheme in relation to the preparation and approval of the financial statements for Mitie Group for the year ended 31 March 2016.

After a detailed review of the evidence, the FRC’s executive counsel decided that the evidential test for bringing enforcement action is not met.  Accordingly, the case has been closed.

The accountancy scheme investigation, which typically looks at the conduct of individuals who are members of one of the professional bodies, opened in November 2017. No information was given at the time about the individuals concerned.

The FRC said its investigation into Deloitte’s audit of Mitie Group’s financial statements for the years ended 31 March 2015 and 2016 remains ongoing.

This separate investigation was open in July 2017, after Mitie signalled it would be making a series of write downs follow a review of its accounting methodologies.

In its 2017 annual report, Mitie said it ‘had found that improvements were required in the approach to risk management and internal audit and has made changes in both those areas’.

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