01/08/2022 - 16:08

Big Un auditor fined over report

01/08/2022 - 16:08

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The lead auditor of failed ASX-listed video marketing company Big Un has been convicted over a report about its financial health less than a year before its collapse.

Big Un auditor fined over report

The lead auditor of failed ASX-listed video marketing company Big Un has been convicted for producing a misleading report about its financial health less than a year before its collapse.

Graham Rothesay Swan was hit with a $2,000 fine in Perth Magistrates Court today after pleading guilty to failing to conduct the audit of Big Un in compliance with the necessary standards. 

The charges followed a major investigation by the corporate watchdog which centred around an audit his firm Rothsay Auditing conducted for Big Un back in 2017.

In October 2017, Big Un released to the ASX its results for the 2016/17 financial year based on that audit, claiming the company’s cash revenue was up 429 per cent.

Further, it told the market Big Un had cash and cash equivalents in excess of $9.2 million.

But Big Un was forced to issue a correction nine months later following a direction from the Australian Securities and Investments Commission, conceding that figure was about one-tenth of that initially stated.

Following a review of Big Un’s financial position, it was revealed the company had liabilities of more than $9.5 million.

By August 2018, administrators had been appointed and the company had been wiped from the ASX.

The offence carries a maximum penalty of up to two years imprisonment for individuals or a fine of up to $53,280 for audit companies.

Following this morning's court hearing, ASIC deputy chair Sarah Court emphasised the crucial role auditors played as “gatekeepers to the market” when it comes to ensuring investors had accurate information.

Mr Swan, who cancelled his registration as a company auditor in 2020, is now the second auditor to be hit with criminal charges for failing to adhere to auditing standards.

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