The U.K. Financial Reporting Council (FRC) on Wednesday issued a disciplinary formal complaint against KPMG for allegedly providing “false and misleading” information during inspections into the Big Four firm’s audits of Carillion and Regenersis.

KPMG’s engagement partners in the Carillion and Regenersis audits—Peter Meehan and Stuart Smith, respectively—were also served complaints. The audits under inspection include the financial statements of Carillion for the period ended Dec. 31, 2016, and the financial statements of Regenersis for the period ended June 30, 2014.

Carillion, which employed about 19,000 people in the United Kingdom, issued a profit warning four months after KPMG signed off on its accounts in 2017. It collapsed in January 2018, having a pension deficit of about £800 million (U.S. $1.1 billion) and owing more than £1.3 billion (U.S. $1.8 billion) to its banks.

The FRC opened an investigation in November 2018 after KPMG self-reported issues it identified during a quality review of the 2016 Carillion audit. KPMG further commissioned external counsel to analyze its response to other quality reviews in coordination with the FRC, which resulted in the identification of similar concerns in relation to the 2014 Regenersis audit. Consequently, the FRC expanded the scope of its investigation in July 2019 to include Regenersis.

“The formal complaint does not allege misconduct arising from the performance of the relevant audits, nor does it allege that in either case the financial statements had not been properly prepared,” the FRC stated. The 2016 Carillion financial statements are the subject of other FRC investigations announced in January 2018 and March 2018.

A KPMG UK spokesperson responded, “We take this matter extremely seriously. We discovered the alleged issues in 2018 and 2019, and on both occasions immediately reported them to the FRC and suspended the small number of people involved. The allegations in the formal complaint would, if proven, represent very serious breaches of our processes and values. We have cooperated fully with our regulator throughout their investigation.”

A disciplinary tribunal has been convened to hear the formal complaint and determine whether misconduct has been committed. The hearing is scheduled to begin in January 2022.

In July, the FRC singled out KPMG for “unacceptable” deficiencies regarding the firm’s audits of banks and similar entities as part of its 2020/21 audit quality inspections.

“Given the systemic importance of banks to the U.K. economy, the FRC will be closely monitoring KPMG’s actions to ensure findings are addressed in a timely manner,” the regulator stated. “KPMG has agreed additional improvement activities to be delivered this year over and above its existing audit quality improvement plan.”