The Financial Reporting Council (FRC) has announced it is to drop its investigation conducted under the Accountancy Scheme into PwC's conduct in relation to compliance reports for Barclays Capital Securities Ltd, the investment banking arm of Barclays.

The investigation related to PwC's work on the preparation of reports to the Financial Services Authority for the periods from 1 December 2001 to 29 December 2009 in respect of the client asset rules.

In its statement, the FRC said the investigation had concluded 'there is no realistic prospect' that a tribunal would make an adverse finding against the firm. Consequently, no further action will be taken and the case will be closed.

In a statement PwC said: 'We cooperated fully with the FRC in its investigation and are pleased that, having investigated the matter, the FRC has closed it without any action. This confirms our view that there was no case to answer.'