Grant Thornton fined £1.3m over Sports Direct audit failings
The Financial Reporting Council (FRC) said the fines relate to accounts for Sports Direct International, now Frasers Group, in 2016 and 2018.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Accounting giant Grant Thornton has been slapped with a £1.3 million fine over “serious failings” in its audit of Sports Direct, a watchdog has announced.
The Financial Reporting Council (FRC) said the fines relate to accounts for Sports Direct International, now Frasers Group, in 2016 and 2018.
It also sanctioned Philip Westerman, the partner in charge of the audit at the time, with an almost £80,000 fine.
The punishment is the latest sanction for Grant Thornton, after it was fined £2.3 million last year over failings in its accounting for Patisserie Valerie and fined almost £2 million in 2020 over the audit of drinks group Conviviality.
Grant Thornton is now expected to report back to the regulator on its work improve its auditing standards.
The finding relates to failures by the auditor and Mr Westerman to establish that “delivery company A”, a group involved in some of Sports Direct’s transactions, was a related party in its 2016 accounts.
The regulator said Grant Thornton failed to use “professional scepticism” to recognise that the delivery company was a related party.
The FRC said it had planned to fine Grant Thornton £2.05 million for the failings, but reduced this to around £1.3 million after early admission to errors by the company.
A spokesman for Grant Thornton said: “We are pleased to now conclude these long-running matters, which date back to 2016.
“Having invested significantly in the quality of our audits since this time, we have seen a marked improvement in our results and are confident that the issues identified by the FRC’s investigations, whilst limited to discrete areas of the audits, are not reflective of the work we produce today.
“Today’s announcement marks the final outcome of legacy FRC investigations, all of which have been in the public domain for some time.”