MPs investigating the collapse of Carillion have today published their final report into the company's demise with the 100-page report lambasting its board for a "rotten corporate culture" that led to the company's "devastating and hugely costly failure".
The joint report by the Commons Work and Pensions and the Business, Energy and Industrial Strategy (BEIS) committees says the firm's collapse, one of the biggest in the United Kingdom in recent times, exposed "systemic flaws" in corporate Britain and its "toothless" and "feeble" regulators.
The government called the Official Receiver into Carillion four months ago after banks and investors refused to support the group, which had annual turnover of £5 billion and 43,000 employees.
The MPs also accused the Financial Reporting Council (FRC) and The Pensions Regulator (TPR) of being too timid to exercise their powers, which could have saved jobs and pension cash.
'The company's delusional directors drove Carillion off a cliff and then tried to blame everyone but themselves.
A board of directors too busy stuffing their mouths with gold to show any concern for the welfare of their workforce or their pensioners.
"Government urgently needs to come to Parliament with radical reforms to our creaking system of corporate accountability".
The company - which specialised in government contracts from building hospitals to managing schools - collapsed in January with huge debts.
'Their colossal failure as managers meant they effectively pressed the self-destruct button on the company'.
The committees also slammed large accounting firms, claiming the market for auditing major companies is "neatly divvied up" among the Big Four firms and that a "lack of meaningful competition" creates conflicts of interest.
They said the Insolvency Service should carefully consider whether former directors breached their duties under the Companies Act and should be recommended for disqualification.
Carillion employed thousands of people on cleaning and catering contracts nationwide
"And when we had the directors in front of our Select Committee, they seemed to be in total denial about what happened to their company".
The report is brutal in its assessment of the "Big Four" auditing firms - KPMG, PwC, EY and Deloitte - which together received more than £70 million in fees from the firm over a 10-year period.
As Carillion slithered ever closer to the brink, the board elected to increase dividends every year and, even as the business very publicly began to unravel, they were more concerned with protecting - and increasing - their generous executive bonuses.
"They are guilty of failing to tackle the crisis at Carillion, failing to insist the company paint a true picture of its crippling financial problems", she said.
"Long term obligations, such as adequately funding Carillion's pension schemes, were treated with contempt".
The report has some heavyweight recommendations, key among which is that the audit market be referred to the competition authorities with a view to a break-up of the Big Four.
But Carillion's former finance director, Richard Adam, rejected the committees' conclusions and said he objected to quotes in the MPs' report, which he said had been misattributed to him.
The MPs also highlighted the "aggressive accounting policies" followed by directors.
But a KPMG spokesman said it believed it had conducted its audits of Carillion "appropriately", and Ernst & Young said it was "extremely disappointed that despite all efforts the business was not rescued".
"Our priority has been to keep public services running safely across the country while saving thousands of jobs", said PwC chairman and senior partner Kevin Ellis. Measures taken to improve the business environment, such as the code for prompt payment of suppliers, have proved "wholly ineffective".
The joint committee report says that Carillion exposed the UK's audit market as a cosy club incapable of providing the degree of independent challenge needed.
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