The UK Financial Reporting Council (FRC) has delivered a disciplinary formal complaint against two auditors of Baker Tilly UK for unethical conduct in the audit of electrical car manufacturer Tanfield Group.

An independent disciplinary tribunal will be appointed to hear the formal complaint against Baker Tilly UK office managing partners Richard King, a member of the Institute of Chartered Accountant in England and Wales (ICAEW), and Steven Railton, a member of the Association of Chartered Certified Accountants (ACCA).

The formal complaint comes four years after the initial investigation by the Accountancy and Actuarial Discipline Board (AADB) over Baker Tilly UK’s audit of the 2007 and 2008 financial statements of Tanfield Group.

The complaint concerns the audit of significant balance sheet items in the 2007 financial statements and alleges that King and Railton’s conduct "fell significantly short of the standards reasonably to be expected".

The FRC said in a statement: "They failed to act in accordance with the fundamental principle of their professional bodies’ codes of ethics requiring them to act with professional competence and due care."

There is a realistic prospect that a disciplinary tribunal will make an adverse finding against the respondent and that a disciplinary hearing is desirable in the public interest, the FRC statement continued.

The FRC also said its investigation in this matter was concluded and that no further action will be taken in respect of the 2008 financial statements.

A spokesperson for Baker Tilly UK Audit said: "The complaint relates to specific aspects of an audit assignment that was completed almost six years ago. As the matter is subject to the formal regulatory processes of the Financial Reporting Council, it is professionally inappropriate to comment at the present time."

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