Accounting watchdog considers Thomas Cook investigation

The UK’s accounting regulator is considering an investigation into Thomas Cook’s auditors.

The Financial Reporting Council said it would work the Insolvency Service to investigate the travel group’s auditors.

The regulator has the power to hand out sanctions to auditors and individuals who are members of the accounting profession.

EY was Thomas Cook’s auditor until PwC was appointed in 2017

Thomas Cook’s auditor is EY, which took over from PwC in 2017.

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An FRC spokesperson said: “In light of recent developments at Thomas Cook we are considering whether there is any case for investigation and enforcement action as a matter of urgency and in cooperation with the Insolvency Service.”

Thomas Cook collapsed in the early hours of Monday after last-minute efforts to secure a rescue deal failed.

The 178-year-old business ceased trading with 600,000 overseas, including 150,000 from the UK.

The CAA is carrying out the biggest-ever repatriation of UK travellers with more than 45 aircraft sourced from around the world.

Thomas Cook has faced major challenges in the last year including in May when it reported losses of almost £1.5 billion, largely down to a write-down relating to the merger with MyTravel in 2007.

Business secretary Andrea Leadsom has demanded a probe into the conduct of bosses involved in the collapse of Thomas Cook.

The disclosure came as prime minister Boris Johnson criticised the directors of the failed travel giant for paying themselves large amounts before the company went “down the tubes”.

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