The Financial Supervisory Authority of Norway has published an inspection report on RSM Norge AS following media reports of loan fraud linked to audit clients, identifying serious and, in several cases, gross breaches of the Norwegian Auditor Act in the performance of audits. The engagement partner was notified of an intended revocation of his state-authorised auditor approval, after which he relinquished the authorisation and the supervisor deleted it and closed the case against him; no new decision was taken against the audit firm in this matter. The 2024 inspection covered audits of the 2021 and 2022 financial statements of Bull og Årstad DA and two related companies, Otica AS and Siviløkonom Per A. Ousdal AS, as well as audit work on two loans of NOK 3 million and NOK 5 million in another engagement, for all of which unmodified audit reports had been issued. The report highlights deficiencies including inadequate assessment of regulated loan mediation activity and the use of client accounts, weak risk assessment and testing of payments from client accounts, insufficient documentation and written communications, limited scrutiny of extensive related-party transactions and a private account used for transactions totalling around NOK 20 million, and insufficient audit evidence on the valuation and security of material loans; it also flags shortcomings in assessing anti-money laundering investigation duties and in the basis for year-end postings where the auditor prepared accounts. In explaining why it did not impose a further measure on RSM Norge AS, the supervisor points to the earlier 2023 inspection that resulted in infringement fines under the Auditor Act and the Anti-Money Laundering Act, and to the firm’s subsequent remediation and supervisory follow-up on governance and internal controls.

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