UK Audit Watchdog Opens Inquiries into Man City Accounts

The UK's accounting watchdog has confirmed it is making inquiries into Manchester City's books, opening a second front in the fallout from the club's guilty verdict on Premier League financial charges.

The Financial Reporting Council told the House of Commons business select committee it assumed "regulatory consideration" of the case on 30 September, taking over from the Institute of Chartered Accountants in England and Wales. No formal investigation has been opened yet, but the FRC carries far greater powers and resources than the professional body it replaces.

Why this one is different

City were found guilty by an independent commission of all charges relating to breaches of Premier League financial regulations between the 2009-10 and 2017-18 seasons — including artificially inflating the club's financial position by more than £900m. The club is appealing, arguing the decision contains "material errors, of law, principle and fact and is unsafe".

The FRC can now examine whether BDO, City's auditors and the UK's fifth-biggest accountancy firm, carried out the audits properly. The commission had found the club gave a "misleading impression" of the scheme used to disguise shareholder funding — and that the auditors were unaware of it. Sanctions could reach individual directors and employees who belong to professional accountancy bodies. BDO declined to comment.

Political pressure

Liam Byrne, chair of the business select committee, said the regulator's own letter exposes gaps: it cannot compel evidence from the club or pursue directors outside its disciplinary rules. He wants the government to explain why planned reforms were dropped and how accountability will be strengthened.