• Register
Return to: Home > News > Fired up FRC issues record ban

Fired up FRC issues record ban

The UK’s Financial Reporting Council (FRC) has issued a record period of exclusion from the profession for three people.

Three former executives of AssetCo, a fire and rescue services business, have been excluded from the profession for committing misconduct in relation to the preparation and approval of the company’s financial statements for the financial years ended 31 March 2009 and 31 March 2010.

Former chief executive John Shannon was excluded for 16 years, former chief financial officer Raymond Flynn for 14 years, and former financial controller Matthew Boyle for 12 years.

Additionally, fines of £250,000 ($321,995), £150,000, and £100,000 were issued respectively.

As a result of the misconduct, AssetCo restated its financial statements in 2011, which showed a £146m reduction in assets, £25m reduction in profit. Significant loss was caused by the collapse in share price from 60p to 1.75p.

The FRC’s executive counsel brought 27 allegations of misconduct against Shannon, Flynn and Boyle before the tribunal. The tribunal, chaired by Bernard Eder, found misconduct in relation to all of them.

These included findings of dishonesty and failing to act in accordance with core standards of integrity, objectivity and competence, which related to dealing with company funds, the preparation of financial statements, and the recognition of fictitious assets and revenue. The tribunal also found that they had each misled the auditors, Grant Thornton UK.

The FRC’s interim executive counsel Claudia Mortimore said: “The misconduct of the three accountants in this case is the most serious the FRC has put before a tribunal. In addition to the financial harm caused to the company and to many investors, the actions of these individuals have damaged public confidence in the profession.

“The Tribunal has recognised this and it is reflected in the imposition of lengthy periods of exclusion, as well as substantial financial penalties. These sanctions should send a clear message that the manipulation of financial statements, and in particular dishonesty, will be dealt with robustly.”

Top Content

    IRBA: taking transparency to the next level

    Bernard Agulhas, chief executive officer at the Independent Regulatory Board for Auditors (IRBA), talks to Joe Pickard about the introduction of mandatory audit firm rotation, and the future of the Big Four in South Africa

    read more

    Sustainable investment: Accountants hold the key

    The US Institute of Management Accountants has a plan to remind professionals that they have the skills to take leadership roles in ESG investing. Carlos Martin Tornero writes

    read more

    IASB: progress towards global standards

    In an extract from a speech given at the Accounting Standards Board of Japan conference in Tokyo, Hans Hoogervorst looks at a possible return of the amortisation of goodwill to IFRS, and the standards’ progress in Japan

    read more

    IMA: developing diversity

    At the end of the July, the Institute of Management Accountants (IMA) appointed Linda Devonish-Mills as its first director of diversity and inclusion. Joe Pickard discusses with her what she plans to do in her new role

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.