Carillion board slammed over "rotten culture" that led to firm's demise

Carilion

"What makes this all the more painful is that many of those who bore the brunt of its collapse - its employees, suppliers and other stakeholders - were among those who helped keep company on its feet for as long as it did".

They said the directors had presented themselves during parliamentary hearings as "self-pitying victims" of "unforeseeable mishaps".

Professional services firms have pocketed a total of £71.6m in Carillion-related work since 2008, including on its pension schemes, according to a separate report by the committees. Same old greed. A board of directors too busy stuffing their mouths with gold to show any concern for the welfare of their workforce or their pensioners.

'They rightly face investigation of their fitness to run a company again.

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Frank Field, chairman of the Work and Pensions Committee, said: "Government urgently needs to come to Parliament with radical reforms to our creaking system of corporate accountability". "British industry is too important to be left in the hands of the likes of the shysters at the top of Carillion". It employed 43,000 people, about 20,000 of them in the United Kingdom, thousands of whom have lost their jobs.

"The committees said that in its failure to question Carillion's financial judgements and information, KMPG was complicit in the company's questionable accounting practices, complacently signing off its directors' increasingly fantastical figures" over its 19 year tenure as Carillon's auditor. "Their colossal failure as managers meant they effectively pressed the self-destruct button on the company".

"The sorry saga of Carillion is further evidence that the Big Four accountancy firms are prioritising their own profits ahead of good governance at the companies they are supposed to be putting under the microscope".

KPMG signed off numerous sets of Carillion's annual accounts, while PwC prospered by picking up the lucrative mandate to assist the government's Official Receiver in winding down the firm's operations.

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The MPs have called on the Competition and Markets Authority to examine a break-up of the Big Four.

One of the most shocking findings is that Carillion's directors focused on bonus pay-outs to senior executives even as the firm teetered on the brink of collapse.

The government and regulators were also blamed for playing a role in Carillion's demise.

The MPs added that regulators should now consider banning the former directors from serving on other company boards.

The two select committees also attacked the big four accounting firms for approving Carillion's accounts despite its spiralling debts.

Adam's sale of £776,000 shares shortly before Carillion's collapse "were the actions of a man who knew exactly where the company was heading once it was no longer propped up by his accounting tricks", the report says.

Richard Howson was the figurehead for a business that "careered progressively out of control under his misguidedly self-assured leadership". Philip Green, who was chairman from 2014 until the firm's liquidation, was described as "an unquestioning optimist".

They continue: "Long-term obligations, such as adequately funding Carillion's pension schemes, were treated with contempt".

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