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The Australian Securities and Investments Commission is investigating documents that the scandal plagued consultancy KPMG lodged with the regulator last year to determine if it contained any false or misleading statements.
“Initial inquiries are focused on the basis for statements made in that report, including the statement that there were no whistleblower complaints related to audit quality,” ASIC said in a submission on Friday to a parliamentary hearing into the KPMG whistleblower scandal.
At a previous hearing, ASIC chair Sarah Court said its powers in relation to investigate wrongdoing were limited by the fact that KPMG operates as a partnership, but the regulator appears to now be using the corporate entities associated with the firm to investigate its botched handling of the scandal over two years.
“We can only investigate individual registered company auditors within the partnership, and only then in relation to their conduct of an audit,” Court told a public hearing into the scandal back in June this year. She will give the parliamentary committee that is investigating the scandal an update and answer questions later this morning.
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Ahead of Court’s appearance, the commission confirmed that it was “conducting an assessment of the corporate entities in the KPMG corporate group to identify any director conduct that may require further regulatory consideration.”
Last month ASIC confirmed its KPMG investigation now includes companies controlled by the accounting and consulting giant, and potentially these companies’ directors who have resigned over the growing scandal.
KPMG has been under siege after admitting that some of its staff accessed confidential information from corporate clients to win business – a serious breach of trust in the world of auditing that is essential to the integrity of financial markets.
Separately, ASIC said it is currently assessing 24 KPMG entities “to determine whether it may be relevant to KPMG’s current investigations” and identified KPMG Australia Pty Ltd and KPMG Australia Services Pty Ltd as entities that may be “relevant” to its investigation.
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“We will consider the conduct of directors of those entities where the circumstances of the relevant entity indicate that such consideration is required. At this stage, that assessment is ongoing,” ASIC said last month.
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Colin Kruger is a senior business reporter for the Sydney Morning Herald and The Age.Connect via email.AdvertisementAdvertisement