Closure of investigation into the conduct of Mr Laurie McIlwee

News types: Statements

Published: 31 August 2016

48/16 The Financial Reporting Council (FRC) announces the closure of its investigation into Mr Laurie McIlwee, former Chief Financial Officer of Tesco PLC.

Following the FRC’s announcement in December 2014 of an investigation under the Accountancy Scheme into the conduct of Members and a Member Firm in relation to the preparation, approval and audit of the financial statements of Tesco plc, the Executive Counsel to the FRC has concluded that there is no realistic prospect that a Tribunal would make an adverse finding in relation to the conduct of Mr Laurie McIlwee.

The FRC’s investigation into a Member Firm and other Members is ongoing.

Notes to editors:

1.    The FRC is responsible for promoting high quality corporate governance and reporting to foster investment.  We are the UK competent authority for audit and set the UK Corporate Governance and Stewardship Codes as well as UK standards for accounting, auditing and actuarial work.  We represent UK interests in international standard-setting.  We also monitor and take action to promote the quality of corporate reporting and auditing.  We operate independent enforcement arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.

2.  In relation to enforcement matters, the FRC is the independent, investigative and disciplinary body for accountants and actuaries in the UK dealing with cases which raise important issues affecting the public interest. In brief, the stages of the disciplinary process under the Accountancy Scheme are:

·         Decision to investigate
·         Investigation
·         Decision whether to bring enforcement proceedings against Member Firm or Member and, if so decided, referral to Disciplinary Tribunal
·         Tribunal hearing
·         Determination and imposition of sanction and/or costs orders

Under the Accountancy Scheme the FRC can start a disciplinary investigation in one of two ways: (i) the professional bodies can refer cases to the FRC; and (ii) the FRC may decide of its own accord to investigate a matter. The Conduct Committee will consider each case identified or referred to it and decide whether or not the criteria for an investigation are met.

The criteria are specified in paragraph 5(1) of the Accountancy Scheme. A Member or Member Firm shall be liable to investigation under this Scheme only where, in the opinion of the Conduct Committee the matter raises or appears to raise important issues affecting the public interest in the United Kingdom and there are reasonable grounds to suspect that there may have been Misconduct or it appears that the Member or Member Firm has failed to comply with any of his or its obligations under paragraphs 14(1) or 14(2) of the Scheme.

Investigations are conducted by Executive Counsel and the Enforcement division.

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