Deloitte's response to being fined £14m by the Financial Reporting Council, and seeing one of its former partners banned from the profession for three years, is extraordinary.
Remember the background here. Some 6,000 car workers lost their jobs when MG Rover collapsed in 2005. The so-called Phoenix Four, the businessmen who turned out not to be saviours of the firm, had collected £42m, partly through the use of complex schemes that Deloitte helped to execute. The four, damned by a government report in 2009, were later disqualified as company directors.
The FRC identified a "persistent and deliberate disregard" of accountancy ethics on the part of Deloitte and Maghsoud Einollahi. The regulator's report details Deloitte's conflict of interest during its work for various parts of the MG Rover group.
Rather than apologise, though, Deloitte wants to argue. It is "disappointed" by the ruling and advances this argument: "This [finding] could have negative implications for the advice that can be provided by ICAEW [The Institute of Chartered Accountants in England & Wales] member firms and members, both within the profession and business".
Negative implications? Well, it depends where you're sitting. From Deloitte's point of view, yes, it would be nice to inhabit a simple world where corporate advisers can merely advise their clients. But the rest of us would like to have an accountancy and advisory industry capable of judging when clients' interests and the public interest diverge. The FRC ruling sounds like it carries positive implications.
Of course, judgements will rarely be straightforward in practice. But MG Rover, surely, was a company where there was a duty on Deloitte to act with extra diligence.
The government had been involved with the rescue of a firm that was the last big British-owned carmaker.
Rather than grumbling, Deloitte should accept with good grace the findings of a regulator charged with promoting good corporate governance. Alternatively, Deloitte's partners are free to find some other line of work.
