Thursday 19 December 2019 8:39 am

Watchdog extends Thomas Cook probe

The UK’s accounting watchdog is extending its investigation into the collapse of travel operator Thomas Cook.

The Financial Reporting Council (FRC) announced a probe into EY’s audit of Thomas Cook’s financial statements for the year ended 30 September 2018 following the company’s collapse earlier this year. 

Read more: Thomas Cook went bust with liabilities of £9bn

The regulator will now also investigate the audit of the firm’s financial filings for the year ended 30 September 2017.

Thomas Cook appointed EY as auditor in 2017, replacing Big Four rival PwC. The following year EY “strongly recommended” that the company strengthened its accounting practices.

It was revealed earlier this month that Thomas Cook entered insolvency in September with total liabilities of £9bn, oweing £585m to customers and £45m to employees. 

Around 50,000 customers are still waiting to be refunded, despite the fact that the Civil Aviation Authority has already paid out £160m.

Read more: Thomas Cook: Regulator sorry for refund delay

The Insolvency Service said £5.7bn was owed to other group companies and £1.7bn was owed to banks and other lenders. 

The government’s business select committee also launched its own investigation into the company’s collapse.