KPMG faces probe into BAE audits

City A.M. Reporter
The accounting regulator said it will investigate consultancy firm KPMG over its audits of defence firm BAE Systems, which was fined earlier this year for questionable payments to secure contracts.

Audits covering the ten years between 1997 and 2007 will be investigated, as well as "commission payments paid by BAE," Britain's Accountancy and Actuarial Discipline Board said in a statement posted on its website.

"The Accountancy and Actuarial Discipline Board has begun an investigation under its accountancy scheme into the conduct of KPMG Audit plc as auditors to BAE Systems plc," the regulator said.

BAE in February reached a deal to pay about $450m in fines to settle long-running corruption investigations in the United States and Britain over payments made to clinch arms deals.