Accountants PwC Investigated Over BHS Audit

Accountancy firm PwC will be investigated over its audit of financial statements for failed retailer BHS.

The Financial Reporting Council (FRC) is examining PwC's conduct in relation to the audit of financial documents in the year to 30 August 2014, the year before Sir Philip Green sold the business for a £1.

The FRC has already carried out a preliminary investigation, which confirmed a "suspicion of misconduct" and paved the way for a formal investigation.

If this investigation does confirm misconduct on PwC's part, the case will go to an independent tribunal and be argued in court.

Should the FRC's findings be upheld, PwC could face unlimited fines or costs, and individuals could be barred from working as an auditor.

A PwC spokesperson said: “We will co-operate fully with the FRC’s investigation.”

The high street giant went into administration in April, putting some 11,000 jobs at risk with the closure of up to 164 stores.

The retailer's collapse leaves the Pension Protection Fund (PPF) – the "lifeboat" funded by a levy on other retirement schemes – having to shoulder the burden of a £571m BHS pension black hole.

The Department for Work and Pensions, and the Business, Innovation and Skills (BIS) Select Committees are currently investigating the sale and collapse of BHS, and there are separate probes by the Insolvency Services and Pensions Regulator.

The inquiry hearings have often been stormy, with no love lost between former owner Sir Philip and Dominic Chappell, who headed Retail Acquisitions Limited (RAL), which bought BHS in 2015.

The roles of administrators Duff and Phelps, and investment giant Goldman Sachs have also been scrutinised closely.