Lord Dyson chaired the disciplinary tribunal appointed by the Financial Reporting Council to investigate allegations made by the FRC against Deloitte and two of its former audit partners in relation to the audit of Autonomy’s accounts between January 2009 and June 2011. The tribunal’s 268-page report was published on 6 January 2021. The tribunal found that Deloitte and both partners were culpable of serious failures in a number of respects. These included misallocating certain costs, non-disclosure of sales, inappropriate recognition of revenue from sales and lack of professional scepticism. The tribunal also found a lack of integrity by Deloitte and the partners in failing to correct misleading statements made by Autonomy to the Regulator; and a lack of objectivity by Deloitte and one of the partners (Mr Knights).
Deloitte was ordered to pay a record fine of £15 million and costs in excess of £5 million. The partners were also ordered to pay substantial fines.
The case and the tribunal’s decision has attracted a great deal of media interest. Elizabeth Barrett, Executive Counsel at the FRC has said: “The full Tribunal Report repays careful study….The report also addresses the expectations of auditors when they are involved in communications with an audited entity’s regulator…”
See press coverage below: