The Financial Reporting Council (FRC) alleges that Nicholas Boden, PwC’s senior statutory auditor and audit engagement partner, and the firm failed to act in accordance with the fundamental principle of professional competence and due care contained in the ICAEW code of ethics in relation to the audit of the financial statements of RSM Tenon, and that their conduct fell significantly short of the standards reasonably to be expected of a member or member firm of the ICAEW.

The FRC’s disciplinary formal complaint further alleges that Russell McBurnie, the RSM Tenon former finance director, failed to act in accordance with the fundamental principles of integrity and professional competence and due care contained in the code in relation to the preparation and approval of the financial statements of RSM Tenon, and that his conduct fell significantly short of the standards reasonably to be expected of a member of the ICAEW.

In addition, the FRC has agreed a settlement with Andrew Raynor, the ex-CEO of RSM Tenon, following an admission of misconduct. Raynor has admitted that his conduct fell significantly short of the standards reasonably to be expected of a member of the ICAEW in relation to the approval of the financial statements of RSM Tenon and that he failed to act in accordance with the fundamental principle of professional competence and due care contained in the code. 

Raynor admitted that he failed to obtain the necessary level of assurance in relation to the accounting treatment of bonus accruals and a lease, to sign off on the financial statements of RSM Tenon on the basis that they were in accordance with applicable accounting standards and represented a true and fair view of the state of affairs of the company.

The FRC fine of £40,000 has been reduced to £26,500 after mitigation and a settlement discount. Raynor has also been given a reprimand and is required to pay £50,000 as a contribution to the FRC’s executive counsel's costs.