Citigroup have called the regulation of UK companies’ accounts ‘toothless’.
These accusations from Citi analysts follow the alleged improprieties at Autonomy, a British software company recently acquired by Hewlett-Packard. A feud has occurred between the two companies, with Hewlett-Packard claiming after the acquisition of Autonomy that it had found evidence of ‘willful [financial] inflation’ by Autonomy of its books in order to appear more valuable before being purchased.
Although the authors of the Citi research noted that it wasn’t clear whether or not these allegations would be proved, they questioned the way in which financial report has been policed under the FRC, saying it was done in secret and on a ‘very limited budget’.
The FRC denied these claims. Read the full story in the Financial Times.