In one tribunal a member and former insolvency practitioner was severely reprimanded, fined £12,500 and required to pay costs, when acting as a liquidator, for:
- Breaching the fundamental principle of professional competence and due care and/or professional behaviour set out in Part D of the Code of Ethics by repeatedly failing to respond to communications from the sole director/shareholder; providing incorrect information to the sole director/shareholder regarding the procedure for the submission of the pre-liquidation corporation tax return and failing to progress the liquidation.
- Breaching paragraph 3.7 of the Insolvency Licencing Regulations as he failed to comply with Section 92A Insolvency Act 1986 read with Rule 18.7 of the Insolvency Rules (England and Wales) 2016 in that his first annual report was not sent to the prescribed persons within the prescribed period of two months following the anniversary of the liquidation.
- Issuing reports which did not comply with the Insolvency Rules (England and Wales) 2016 and/or breached the fundamental principle of professional competence and due care set out in Part D of the Code of Ethics because he produced a progress report which did not include details of any interim dividends in contravention of Rule 18.3 and he issued a progress report which included incorrect information on dividends in contravention of Rule 18.14.
In another tribunal a member was excluded from membership and required to pay costs for failing to provide to ICAEW the information, explanations and documents requested by a letter issued in accordance with Disciplinary Bye-law 13.1, contrary to Disciplinary Bye-law 13.2.
In the third tribunal publicised, a member was excluded and required to pay costs following a breach of Client Money Regulation 3*. He received into and held in the firm’s client account money that did not belong to a client and he transferred £5,000 of the monies held from his firm’s client account into his firm’s business account in breach of the fundamental principle of integrity as set out in s110.1 of the Code of Ethics.
*January 2011 – December 2016 Client Money Regulations
The Investigation Committee made the following orders by consent:
An audit registered firm was severely reprimanded and fined £20,000 because it had issued an audit report on the financial statements of two companies, which stated that the financial statements had been prepared in accordance with applicable law and United Kingdom Accounting Standards (UK Generally Accepted Accounting Practice) and that an audit had been performed in accordance with the International Standards of Auditing (UK & Ireland) when the audit had not been conducted in accordance with ISA 500 “Audit Evidence and ISA 230 “Audit Documentation” relating to
- the existence and valuation of work in progress;
- the completeness and valuation of the provision for losses on long term contracts;
- the recoverability of a deferred tax asset; and
- the valuation of amounts due to connected companies
Further, the financial statements had not been prepared in accordance with Section 404 of the Companies Act 2006 as the consolidated profit and loss account did not deal with the profit or loss of the parent company and its subsidiary undertakings for the whole financial period.
Another audit registered firm was severely reprimanded and fined £14,700 pounds because it had:
- accepted and/or continued appointment and issued audit reports for a number of entities when the firm were not eligible for audit registration with ICAEW as the majority of voting rights were not held by qualified individuals, in breach of Audit Regulation 2.03b;
- failed to submit accurate ICAEW annual returns in breach of Audit Regulation 6.06.
A member was severely reprimanded and fined £11,000 for multiple failures and significant delays in responding to correspondence.
A member was severely reprimanded and fined £9,800 for engaging in practice (through multiple entities) without a practising certificate or Professional Indemnity Insurance (PII), as well as submitting incorrect annual returns and failing to have a money laundering supervisor.
A member was reprimanded and fined £3,500 for failing to fulfil multiple compliance assurances given during a Practice Assurance visit.
A member was severely reprimanded and fined £3,000 because, in his capacity as nominee of a Company Voluntary Arrangement, he breached Paragraph 3.7 of the Insolvency Licencing Regulations as he failed to submit notice of an insolvency event to the Pension Protection Fund and the Pensions Regulator in accordance with Section 120 of the Pensions Act 2004 within 14 days.
While another was reprimanded and fined £1,400 for engaging in practice with no Practising Certificate or PII and failing to have a money laundering supervisor firstly while a student and subsequently as a member.
Another member was reprimanded with no fine for similar issues.
No fine was issued in this case due to significant mitigation.
In further compliance breaches a member was reprimanded and fined £1,400 for failing to notify the member’s registrar of ICAEW of the formation of his practice contrary to member’s regulation and Practice Assurance Regulations. He also failed to obtain a money laundering supervisor.
Each of the above consent orders came with a requirement to pay costs.
Two fixed penalties were also made and published. One to a member convicted of drink driving and another for a member who engaged in practice without a practising certificate.