Accountancy firm PricewaterhouseCoopers (PwC) has been fined £5.6mln after a UK regulator found its audit of defence group Babcock International had been mismanaged.
The Big Four firm has already had to pay out close to £6mln in fines over the last twelve months.
In June last year, PwC was fined twice on the same day -totalling £5mln- for auditing failures at construction companies Kier and Galliford Try.
A few months later the London-based firm was forced to pay £1.7mln in fines for its botched audit of telecom giant BT.
The Financial Reporting Council (FRC) revealed PwC had made serious breaches to audit requirements in its assessment of accounts for Babcock’s 2017 and 2018 financial years.
It was found that the accountancy firm had failed to read through a partnership contract that would have brought in £77mln for the defence company’s 2018 financial year.
Auditors at the company had also failed to translate a French €640mln contract, despite nobody on the team speaking the language, the FRC said.
Furthermore, the team provided Babcock with accounting advice, something that is forbidden for accountancy firms working with large audit clients.
The FRC has ordered PwC to review training programmes and is investigating Babcock’s audits for the 2019 and 2020 financial years.
On top of this, the regulator will examine the signed-off accounts of some of the firm's other clients including Intu, Wyelands Bank and Eddie Stobart.
“We’re sorry that the work in question was not of the standard required and that we demand of ourselves,” said PwC in response to the fine.
KPMG, another of the Big Four accountancy firms, received around US$8.7mln in fines globally over 2022, according to goodjobsfirst.org.
In September last year, Deloitte’s Chinese arm was forced to pay a US$20mln fine for letting some clients conduct their own audits.
The final of the Big Four, Ernst & Young, was forced to pay US$100mln last year after the US securities and exchange commission found its employees had been cheating on accountancy exams.