FRC expands investigation into Mitie accounts

The fresh Financial Reporting Council (FRC) probe follows that which it launched at the end of July into Deloitte, which led to the big four firm resigning as Mitie’s auditor on 19 September.

The board has since appointed BDO on an interim basis until the next AGM, when shareholders will vote on their appointment.

It is understood that the FRC investigation launched this week does not relate to Deloitte staff but rather former directors of the company responsible for the preparation or approval of Mitie’s 2016 accounts.

The FRC said today that it would be looking into the “preparation and approval” of Mitie’s financial statements for the year ending March 31, 2016 and the probe came under its “accountancy scheme”, which it uses to investigate members of accounting professional bodies who it suspects of misconduct or causing losses to investors.

An investigation into the timing and content of two of the firm’s profit warnings last year is already the subject of a separate investigation by the Financial Conduct Authority (FCA).

Mitie said: “The company understands that the investigation does not relate to any current directors of Mitie, any former non-executive directors of Mitie or Sandip Mahajan .”

In the year to March 2016, Mitie was run by Ruby McGregor-Smith, who quit her post as chief executive in October last year.

She was followed out by former finance director Suzanne Baxter, who had been with the support services company since 2006.