TWO OF THE BIGGEST energy companies have proposed Deloitte as their new auditors.
Oil and gas giant BP has outlined Deloitte as auditor from financial year 2018, while energy supplier Centrica, the parent company of brand British Gas, has appointed the firm for the coming year.
EY will continue as the external auditor for BP for the financial years of 2016 and 2017. The firm received a whopping $47m (£37.6m) for the audit and audit-related services for BP in 2015, with an additional $3m in non-audit related services.
Brendan Nelson, chairman of BP’s audit committee, said: “I would like to thank EY for their high professional standards and all they have done to provide assurance to the board and shareholders during their time as BP’s auditors. Subject to approval, we look forward to working with Deloitte.”
The intention for competitive audit tender was announced in BP’s 2013 annual report to be carried out in 2016 – to appoint a new auditor from 2018.
PwC has served as Centrica auditors since the gas services giant’s multi-layered demergers in 1997. The firm received a total of £6.7m in fees for the audit in 2015, plus £2.3m in audit-related services. The Centrica board extended its appreciation to PwC for its audit services and confirmed that their prospective resignation following the 2016 audit had no matters in connection that need to be brought to attention to shareholders.
The news of these appointments comes at a very busy time for Deloitte, which has been investing in technology with Apple, as well as North West expansion and were recently fined a record £4m over misconduct.
Annual appointment of external auditors by AGM is required under UK law, with an auditor’s maximum period to be 20 years, and a competitive tender process required at least once every ten years, following an overhaul of the governance and regulation relating to the industry. Both audit appointments remain subject to approval in the next AGM meetings.