Auditor of Romanian bankrupt insurer City, BDO Audit, fined

BDO Audit, the company that audited the financial reports of bankrupt Romanian insurer City Insurance during its fast-growing period, was warned by the Public Oversight Authority of the Statutory Audit Activity (ASPAAS) and will have to pay a fine in the amount of 0.6% of its turnover for the way it handled the audit, Economica.net reported.

Shortly after lifting the operating license of City Insurance, the Financial Supervisory Authority (ASF) decided to withdraw from the list of approved auditors two of the companies that dealt with the former market leader, namely BDO Audit and Grand Thornton.

BDO had audited City during its fast-growing period (2016-2020), and Grand Thornton produced the report in the last year before the crash. No fine was decided for Grand Thornton.

The issues at City were revealed by the Balance Sheet Review (BSR) stress test carried out by KPMG.

Both BDO Audit and Grand Thornton requested the suspension of the application of the ASF decision and lost the case, but they also asked for the cancellation of the said administrative act. A decision on this was not yet announced.

(Photo source: Dreamstime.com)