Big Four audit firms face heavy penalties for audit failures. On 15 August KPMG is fined over $6.2m by the US Securities and Exchanges Commission for its 2011 audit of oil and gas company Miller Energy. Charged for accounting fraud, Miller had overvalued certain assets by more than 100 times. On 16 August PwC is fined £5.1m by the UK Financial Reporting Council for “extensive misconduct” relating to the 2011 audit of the consultancy firm RSM Tenon. In South Africa, KPMG announces on 11 August that it has suspended its lead audit engagement partner pending the outcome of a review of work done for Gupta-linked companies. KPMG International announces a month later that the head of KPMG SA and seven senior executives will quit after an internal investigation found that work done for the politically connected Gupta family fell “considerably short” of the auditing firm’s standards.
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