ACCOUNTING WATCHDOG the FRC has filed a formal complaint against the former management team at iSoft, almost ten years after ‘accounting irregularities’ were discovered at the health sector software supplier.
The FRC has published disciplinary complaints against Timothy Whiston and John Whelan, two former iSoft finance directors, and alleged the pair “breached the fundamental principle of integrity” and fell “significantly short” of the standards expected of the ICAEW.
iSoft warned on its profits in 2006 after it unearthed accounting irregularities for its 2004 and 2005 accounts as revenues for both these years were presented in the accounts sooner than they should have been.
The disciplinary relates to the preparation, approval and audit of the financial statements of iSoft for the years ended 30 April 2004 and 2005 and alleges that the breaches occurred in relation to iSoft’s recognition of revenue and cash from a contract with the Irish South Eastern Health Board during 2003 – 2004.
The pair could face a significant fine, a written reprimand or exclusion from the ICAEW if the disciplinary tribunal the finds against them.
The FRC has already issued fines against iSoft’s former auditor RSM Robson Rhodes, a firm since taken over by Grant Thornton, and excluded iSoft’s former financial controller from the institute.
Whiston and Whelan were both cleared along with a third man, Steve Graham, of criminal wrongdoing after a fraud trial into iSOFT collapsed in 2013.
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