KPMG Facing U.K. Accounting Probe Over Equity Red Star Audits
Britain’s accounting regulator will investigate KPMG Audit Plc over its accounting for Equity Red Star, one of the U.K.’s largest motor insurance companies and a syndicate of Lloyd’s of London.
The probe will cover KPMG’s audit of Equity Red Star Motor Syndicate 218, which trades as Equity Red Star, for 2007, 2008 and 2009 and will focus on “technical provisions,” according to a statement today from the Accountancy and Actuarial Discipline Board, part of the London-based Financial Reporting Council.
“KMPG will cooperate fully with the AADB’s investigation and is confident that its audit work in relation to the Equity Red Star syndicate met the relevant professional standards,” Gavin Houlgate, a KPMG spokesman, said in a phone interview.
Equity Syndicate Management Ltd., which is owned by Insurance Australia Group Ltd., is the managing agent for the syndicate, said Anna Colban, spokeswoman for the AADB. Disciplinary complaints filed after AADB investigations are heard by independent tribunals.
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