Watchdog considers TransTec action
Accountancy's watchdog, the Joint Disciplinary Scheme, is to consider damning criticism of the directors and auditors of TransTec as part of its own investigation of what happened at the failed engineering company.
Link: PwC slammed over TransTec
The department of trade issued a highly critical report of both auditors PricewaterhouseCoopers and Richard Carr, the chartered accountant who was chief executive at the company before it entered administration. TransTec was the company once run by MP and former paymaster general Geoffrey Robinson, who was left largely unscathed by the report.
Chief among the conclusions was that PwC’s audit of the company’s critical 1998 accounts was ‘inadequate’ and that the firm ‘failed’ to ‘follow’ audit guidance in force at the time.
PwC has emphatically rejected the criticism. But the inspectors worst criticism was for Richard Carr, who was said to have been responsible for ‘serious errors of misconduct’ and a ‘lack of leadership and ethical management’.
Their main charge is that he failed to tell the board about an agreement to pay the Ford Motor Company £11m for a breach of contract.
TransTec’s finance director William Jeffrey was also targeted. He stands accused of failing to disclose the Ford claim and of authorising statutory accounts that failed to make adequate disclosure or provision for the claim.