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The UK accounting regulator has launched an investigation into the audit of EY’s shell accounts for the last year.
The Financial Reporting Council’s decision to launch an investigation comes after Shell said in July that EY had breached independence rules in the US and Britain, which set strict limits for how long a partner at an accounting firm can lead an audit.
Citing Shell’s July statement, the FRC said on Monday that its investigation “will consider whether relevant requirements relating to partner rotation have been breached”, without giving further details.
EY said on Monday that it had violated rules governing the rotation of partners on audits, and said it would “continue to cooperate fully with the FRC during the investigation”.
EY has been Shell’s auditor for nearly a decade. According to the company’s annual report, the firm is projected to earn $66 million from work for Shell in 2024.
This is a developing story
