Auditor signed off accounts in 2012

RSA is seeking external advice about whether it can take action against the auditor that signed off its accounts in 2012.

Deloitte was RSA’s auditor between 2007 and 2013 when it was replaced by KPMG. It wrote in RSA’s 2012 report that its audit involved “obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error”.

Asked this morning whether RSA was taking action against Deloitte, chief financial officer Richard Houghton told analysts: “The board is taking appropriate external advice on this issue. We don’t think we should comment further at this time. We think it would be inappropriate to do so.”

Houghton added that when executive chairman Martin Scicluna left he excluded himself from all board discussions about Deloitte to avoid any suggestion of a conflict of interest. Scicluna chaired Deloitte from 1995 to 2007.

Houghton also confirmed that RSA does not have an insurance policy to cover the £200m loss it suffered in Ireland.

“This is not a set of circumstances where large amounts of money left building or organisation. The issues we have uncovered have been about timings of recognition of claims and premium income,” he said.

The Financial Reporting Council confirmed it has not launched a formal investigation into Deloitte.

A Deloitte spokesperson said: “We have not seen the PwC report nor RSA’s own review, and are not in a position to comment.  Deloitte is committed to delivering the highest quality audit services.”