Norwegian Financial Supervisory Authority revokes a state-authorised accountant’s authorisation after finding gross compliance breaches and absent engagement quality controls

The Norwegian Financial Supervisory Authority has revoked the authorisation of a state-authorised accountant after concluding that gross breaches of law and professional obligations occurred at the accounting firm where the individual held central roles, including managing director and responsibility for quality management and all client engagements. The decision cites significant weaknesses in evaluating clients’ internal routines, performing quality assurance of engagement execution and maintaining adequate engagement documentation. The supervisory review covered three accounting engagements (A–C) for which the accountant was engagement-responsible; all were carried out by staff without state-authorised approval and none had documented quality reviews. Finanstilsynet identified material deficiencies in the 2023 annual accounts and related reporting, including missing fixed-asset notes, missing or inadequate going-concern disclosures and unsupported recognition of deferred tax assets, alongside a lack of a written engagement agreement, missing inventory counts, insufficient balance reconciliations and inadequate documentation. The report also details shortcomings in the accountant’s management of the firm’s own obligations, including late filing of the firm’s 2023 annual accounts, non-submission of VAT returns for 2023 and 2024 and late VAT payments in 2024, late filing of the 2023 tax return, auditor-reported issues relating to handling of withholding tax funds and an unlawful loan of about NOK 1 million to the owner, as well as the deliberate submission of incorrect information to Finanstilsynet in the firm’s self-reporting.