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FCA investigates insurance tech firm over accounts

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The FCA has commenced an investigation into insurance technology firm Quindell Plc.

The regulator says the investigation concerns public statements made regarding Quindell’s financial accounts during 2013 and 2014.

Last month Quindell announced that PricewaterhouseCoopers had completed an independent review of a number of its accounting policies.

The review found that certain accounting policies adopted by the company, in respect of recognising revenue and deferring case acquisition costs in a number of the group’s disposed of businesses, were “largely acceptable but were at the aggressive end of acceptable practice”.

PwC also identified that some policies were not appropriate. In a statement today, Quindell says its own review has confirmed PwC’s findings.

It says it will “adopt a more conservative and appropriate approach” to the recognition of revenues and profits in its professional services division. Quindell announced the division had been sold last month to Slater and Gordon.

Quindell says these changes to its reporting will “materially impact” previously reported results for the year ended 31 December 2013 and the six months ended 30 June 2014.

It says the board has also commenced a review of a number of the company’s historic transactions and acquisitions.

It says: “This work is ongoing but the company expects that it will shortly be in a position to announce additional information in relation to these transactions and acquisitions with a view to ensuring that more complete information is available in respect of the historical position; to ensure that any related party transactions are fully disclosed; and make associated corrections.”

Quindell says it has requested the temporary suspension of trading in its shares from Aim.

It adds it will cooperate fully with the FCA’s investigation.

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