In March 2018, the Insolvency Service concluded its investigation of the collapse of BHS, taking disqualification action against three former directors of the high street chain. When requested to reopen the investigation in October by Field, Albon responded that ‘there is nothing further in this material that would merit disqualification action against either the directors of Taveta, or its subsidiaries; consequently we will not be reopening our investigation’.

In June the Financial Reporting Council (FRC) fined PwC an unprecedented £6.5m after the auditor admitted misconduct regarding its 2014 audits of BHS and Taveta, the holding company owned by Sir Philip Green. Green unsuccessfully sought a court injunction to prevent the publication of the FRC report

In a letter to Sir John Kingman, sent on 6 November 2018, Field and co-signator Rachel Reeves MP said that they wished to raise a further, related issue - the 'longstanding relationship' between PwC and Taveta.

'Between 2004 and 2017, PwC was paid £16.1m by the group, including £4.5m for statutory audit services and £11.5m for non-audit services (including very substantial pensions advice),' they wrote.

'It struck us as unlikely that the 2014 audit was an isolated case. Given the extent of the failures that the FRC uncovered, we wrote to Stephen Haddrill to ask whether the FRC would now investigate previous PwC audits of BHS and Taveta.'

In Haddrill's response, included with the letter, he said that the FRC does not 'as a matter of course' open further investigations into previous audits 'where it has already acted to protect the public interest and levied sanctions'. The letter from Field and Reeves queries if this approach is the correct one: 'On the face of it, there would seem to be a risk of auditors escaping appropriate sanctions for serious misconduct lasting for years'.

Speaking about his upcoming meeting with Albon, Field said: ‘The FRC’s findings, even watered down, made it instantly clear why Sir Philip and his colleagues at Taveta did not want that devastating report to see the light of day. It is difficult for the outside observer to understand why the Insolvency Service sees no reason for further action on what happened at BHS.

‘The current system apparently cannot prevent, capture or punish the conduct that ran BHS into the ground and left its pensioners well short of their entitlement. I hope the Insolvency Service’s insights can now help us start to make the UK’s corporate governance fit for purpose.’

Report by James Bunney