This is the first time the regulator has taken this type of action against an audit firm, describing the publication of the censure against MHA, the UK member firm of Baker Tilly, as a sufficient deterrent.

The censure was issued after top 20 audit firm MHA failed to notify the FCA of rule breaches by two companies it had audited, which the regulator said ‘could have put customers’ money at risk’.

FCA investigators also said that MHA staff working on the reports had ‘limited relevant experience’.

The investigation was launched by the FCA into four client asset sourcebook (CASS) audits of two limited UK companies (neither of which were a public interest entity) performed by MHA over a four-year period between 2015 and 2019.