Britain’s ‘Big Four’ accountancy firms made more than £70million from Carillion in the decade before it collapsed (pictured former chairman of Carillion Philip Green)
Britain’s ‘Big Four’ accountancy firms made more than £70million from Carillion in the decade before it collapsed, a report reveals today.
KPMG, PricewaterhouseCoopers, Deloitte and Ernst & Young had been collecting fees for advice and auditing the bust building firm’s books since 2008.
In a damning report about how the accountants failed to spot warning signs, MPs accused the firms of ‘feasting on what was soon to become a carcass’.
The comments come as an official probe gets under way into KPMG’s checking of Carillion’s accounts in the run-up to the collapse.
Labour MP Rachel Reeves, chairman of the Commons business committee, questioned whether KPMG’s ‘judgment was clouded by … the multi-million pound fees it received’.
Carillion went into compulsory liquidation last month with more than £3billion of debt, 989 jobs lost and an estimated pensions deficit of £990million.
Ministers are now scrambling to shore up hundreds of millions of pounds worth of public contracts, including for schools and hospitals.
MPs today published a breakdown of Carillion fees collected by the Big Four since 2008.
PwC has banked £21.1million, KMPG £20.2million, EY £18.3million and Deloitte £12million.
Last night Labour MP Frank Field, chairman of the work and pensions committee, said: ‘The image of these companies feasting on what was soon to become a carcass will not be lost on decent citizens.
‘The former directors of Carillion are – unlike their pensioners, suppliers and employees – all right. These figures show that, as ever, the Big Four are all right too.’
Last night Labour MP Frank Field, chairman of the work and pensions committee, said: ‘The image of these companies feasting on what was soon to become a carcass will not be lost on decent citizens’
KPMG is being probed by the Financial Reporting Council over its audits of Carillion from 2014 to 2017.
Questions are growing over why it signed off accounts reporting the firm as a going concern about nine months before it went bankrupt.
It comes as it emerged a Carillion pension scheme containing some directors’ pension pots ended last year with a surplus.
The report in Private Eye follows evidence that bosses prioritised paying dividends to shareholders over plugging the gap in the crisis-hit fund.
KPMG is reviewing its work, adding: ‘We have no reason to believe that the 2016 accounts showed other than a true and fair view, and … we believe we conducted our work appropriately and responsibly.’
A Carillion pensions spokesman said: ‘We are not in a position to publish a full breakdown of the individual position of each scheme, but we are working on the basis that all schemes are likely to enter Pension Protection Fund assessment.’