UK regulator penalizes EY and an audit partner for breaches in Made.com’s 2021 financial audit, including going concern and deferred tax asset issues.
The UK’s Financial Reporting Council has fined EY nearly £1.2m and audit partner Julie Carlyle £49,000 for audit failures related to Made.com’s 2021 financial statements. The breaches involved going concern assessments and deferred tax assets, violating international auditing standards.
Made.com, which listed on the London Stock Exchange in June 2021, faced financial strain in 2022 due to supply chain disruptions and weaker consumer demand. The company reported a £35.3m pre-tax loss in its 2022 interim results, prompting EY to issue a disclaimer of opinion on its financial statements.
Both EY and Carlyle received a severe reprimand and were ordered to cover the FRC’s investigation costs. The penalties highlight regulatory scrutiny over audit quality amid market volatility.