A look through the panel’s activity over the past two months would suggest it
is. During this period, the FRRP has forced three listed companies to make
significant changes to their reported numbers.
The most notable and recent of these is Sanctuary Group, the music company
that manages Eurovision winner Lordi and Elton John,
which last year faced the threat of a serious loss of capital because of its
aggressive accounting policies. It sacked its auditor, Baker Tilly, a few months
An FRRP probe into Sanctuary Group saw the company axe its chief executive
Andy Taylor and admit that its accounts had included ‘fundamental errors’.
Sanctuary’s reaction to the FRRP’s investigation was one of the Panel’s biggest
scalps. Other groups to have recently felt the watchdog’s wrath include Higham
Systems and Inveresk.
The intense activity at the FRRP over the past eight weeks marks a stark
contrast to the impression of a toothless regulator that was created when the
Panel’s chairman, Bill Knight, recently pleaded with investors and analysts to
provide the panel with tip-offs.
Yvonne Lang, technical director in assurance and business services at Smith
& Williamson, believes the new role assigned to the FRRP two years ago, when
the Panel increased its staff and adopted a proactive rather than reactive
approach, explains the watchdog’s increased activity.
‘The FRRP has more resources and is far more focused on the sectors it looks
into. I think we are going to see the Panel using its powers to make companies
restate accounts more often,’ said Lang.
However, Isobel Sharpe, an audit partner at Deloitte, says the FRRP should
also be measured against other criteria.
‘The Panel’s work is almost Biblical. There are fallow periods and there are
fertile periods. It all depends on how companies are reporting, or if new
standards have been introduced. Looking at the number of press releases the
Panel issues is not enough,’ said Sharpe.
UK senior partner Phil Verity has been elected for a second term at Mazars
An audit partner has been appointed at Grant Thornton in its North West offices
KPMG has been appointed with “immediate” effect as the auditor of Dorcaster
The audit for Ibstock will be taken over by Deloitte following a competitive tender process