Pursuant to the Crown Dependencies Recognised Auditor Sanctions Procedure, the FRC’s Enforcement Committee has concluded that Crowe UK failed to comply with the Regulatory Framework for Auditing in its audit of Aseana Properties Limited’s financial statements for the year ended 31 December 2019.
The committee found failures in the reviewed audit, which it considered had been unsatisfactory and, overall, a poor-quality audit. The most significant failing was in respect of the carrying value of inventory. The committee identified other areas of concern in respect of the assessment of fraud risk and EQCR oversight.
The committee considered it was necessary to impose a sanction. The committee took into account representations made by Crowe UK and considered the appropriate regulatory penalty to be £180,000, adjusted by a discount of 20% to £144,000, for co-operation and steps taken to ensure non-repetition.
In addition, the committee has accepted written undertakings proposed by Crowe UK, which will be monitored by the FRC’s Audit Quality Review team.
The committee acknowledges that Crowe provided co-operation, including at an early stage, and took appropriate remedial steps once the failings were identified.
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