The UK Financial Reporting Council (FRC) has fined PwC £10m ($13.3m), reduced to £6.5m, for its audit of retailer British Home Stores (BHS), which went into administration in 2016.

The FRC also fined audit partner Steve Denison £500,000, reduced to £325,000, and banned him performing any audit work for 15 years.

Both fines were reduced by 35% due to early settlement.

Under the sanctions, PwC is to ‘monitor and support’ its Leeds Audit Practice and provide detailed annual reports about the practice to the FRC for the next three years.

The FRC launched its investigation into the Big Four firm shortly after the collapse of BHS, in relation to the audit of BHS’s financial statements for the year ended 30 August 2014.

Alongside the FRC investigation into the liquidation of BHS in 2016, the UK Work and Pensions Select Committee also launched an investigation into the collapse. This included scrutiny of PwC in the role of BHS’ auditors. The Select Committee’s report noted that PwC did not dispute BHS’s directors’ assessment that the business remained a going concern. 

PwC UK said in a statement: “We recognise and accept there were serious shortcomings with this audit work. We are sorry that our work fell well below the professional standards expected of us and that we demand of ourselves.”

PwC also said that the firm “took swift action to enhance our monitoring procedures”.

KPMG UK was fined £3.2m earlier in the week for its audit of insurance tech company Quindell.