KPMG settles £1.3bn Carillion lawsuit

Relating to the audits between 2014 and 2016, the suit was brought by Carillion’s liquidators which claimed the auditor had missed “red flags” during its audits of the firm. It also alleged that negligent failures by KPMG to detect misstatements in the accounts of Carillion cost claimants’ extensive loss and damage. 

The former construction firm collapsed in 2018 with nearly £7bn of debt and resulted in 3,000 job losses. It also led to government-backed reviews that recommended a shake-up in auditing standards.

In a statement, KPMG’s chief executive Jon Holt said: “I am pleased that we have been able to resolve this claim. Carillion was an extreme and serious corporate failure, and it is important that we all learn the lessons from its collapse. The FRC’s ongoing investigation into our work as Carillion’s auditor is an important part of that process, and we will continue to cooperate fully with it.”