FRC begins investigation into the financial statements of Thomas Cook

The Financial Reporting Council (FRC) has today initiated an investigation into the audit conducted by EY of the financial statements of Thomas Cook Group Plc for the year ended 20 September 2018.

The investigation arrives following the collapse of the 178-year-old travel company which left thousands stranded abroad and its employees out of work.

In October last year, EY signed off on Thomas Cook’s 2018 accounts as a going concern, declaring that the company could survive and carry out business for a further 12 months.

Following the travel company’s interim results in May, Ey said that there was a “material uncertainty related to going concern” which was linked to a new financing agreement.

Thomas Cook disclosed in the same month that it had agreed to a new £300 million lending facility.

The investigation will be carried out by the FRC’s Enforcement Division under the Audit Enforcement Procedure.

The FRC has said that it will keep under close review, both the scope of this investigation and the question of whether to open any other investigation in relation to Thomas Cook, liaising with other relevant regulators to the fullest extent permissible.

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