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Announcement
ADGM’s Registration Authority Fines Baker Tilly and its Audit Principal USD 62,500 for Audit Failings
ADGM RA 22/02/2024The Registration Authority (RA) of Abu Dhabi Global Market (ADGM) has sanctioned Baker Tilly Middle East Limited (Baker Tilly), an ADGM registered audit firm and, Neil Andrew Sturgeon (Sturgeon), Baker Tilly’s registered audit principal.
The RA imposed the following financial penalties for serious failings and gaps in the financial audit work carried out for two ADGM companies which led to non-compliance with the relevant ADGM requirements:
- USD 50,000 against Baker Tilly; and
- USD 12,500 against Sturgeon.
During an inspection, the RA found significant failures to adhere to the ISA in the two audits carried out by Baker Tilly and Sturgeon. The breaches of ISA were identified in multiple areas of the audit process, from planning and execution to completion and reporting.
High-quality audit is vital for reinforcing trust in financial reporting which allows shareholders, investors, and other stakeholders to rely on financial statements to make informed decisions. The RA expects its registered auditors and audit principals to ensure that all audit work carried out by them is performed diligently, competently and in accordance with all relevant technical and professional standards.
The Registration Authority, notes, “One of the RA’s key regulatory objectives is to promote high-quality audit, which is an essential element of a strong financial and business ecosystem. High-quality audits directly contribute to the integrity of markets, provide investor protection and enable the promotion of businesses with confidence. A robust audit regime and monitoring program help ensure auditors do not fall short of the standards expected from them while also increasing the reliability of financial reporting. The RA will use all regulatory tools at its disposal from outreach to enforcement, as appropriate, to promote high standards of audit quality”.
To access a copy of the Decision Notices describing Baker Tilly and Sturgeon’s contraventions, click on the following links: