Deloitte fined £6m over failures in Go-Ahead audits

8th Oct 2026 12:00

(Sharecast News) - Deloitte has been fined £6.05m by the Financial Reporting Council (FRC) for failings in its audits of transport group Go-Ahead, including failing to challenge the wrongful retention of more than £30m of taxpayers' money.

The accounting watchdog said on Thursday that Deloitte had failed to apply sufficient scrutiny and professional scepticism during its audits of Go-Ahead's financial statements for the five years between 2016 and 2020.

The penalty was reduced from £11m following discounts for exceptional co-operation, admissions and early resolution of the investigation.

The breaches related to three Go-Ahead subsidiaries operating passenger rail services, including London & South Eastern Railway (LSER), which had retained erroneous overpayments from the Department for Transport without informing the government.

LSER subsequently released £2.4m of overpayments to profit in 2016 and accrued a further £27m between 2016 and 2020.

Another subsidiary, London & Birmingham Railway, released £5.6m of money owed to the government to profit in 2020 and attempted to conceal the transaction through the wording of its financial statements, the FRC said.

The regulator also identified failures relating to Go-Ahead's German rail subsidiary, where inadequate audit scrutiny contributed to a provision for loss-making contracts being understated by more than €40m.

Penrose Foss, the FRC's executive counsel and executive director of investigations and enforcement, said: "These breaches show a highly concerning pattern of failure by Deloitte to apply sufficient scrutiny to decisions and actions by GAG which were clearly questionable."

Foss added that the risk posed to large amounts of taxpayers' money was "particularly troubling".

Deloitte was ordered to report on the causes of its audit failings and the measures taken to prevent them recurring. The firm has also paid the regulator's investigation costs, the FRC said.