12th Jun 2020 12:15
(Alliance News) - The UK Financial Reporting Council on Friday said it has imposed sanctions on accountancy KPMG over its audit of Foresight 4 VCT PLC's financial statements.
The FRC issued a final decision notice under the audit enforcement procedure, imposing non-financial sanctions on KPMG, including a reprimand and "an order that KPMG monitor compliance with revised audit procedures on company capital and distributions, and report on this to the FRC's executive counsel".
The UK regulator noted that KPMG had "admitted shortcomings" when it came to its audit of Foresight 4 VCT's distributable reserves figures. Such failings, the FRC said, could have resulted in "misstatements relating to distributable reserves in the company's financial statements, which were later restated in 2016 and 2018.".
The FRC's sanctions are intended to reflect the fact that KPMG breached the requirements unintentionally and without dishonesty or recklessness and that the misstated figures for Foresight 4 VCT's reserves did not affect profit or net asset value.
Alongside these, the FRC also noted that "there is no suggestion that there were insufficient distributable reserves to cover distributions made by the company".
Shares in Foresight 4 VCT were untraded on Friday, having last closed at 52.00 pence. They are down 14% since mid-March.
By Anna Farley; [email protected]
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