THE former chief financial officer of Healthcare Locums, the medical staffing agency which nearly collapsed after discovering irregularities in its accounts, has been banned from working as an accountant for ten years.
In a settlement agreed with the FRC’s counsel and approved by a legal member of its tribunal panel, the recruitment company’s ex-CFO Diane Jarvis has been excluded from the ICAEW for ten years and told to pay the accounting watchdog £25,000 in costs after she admitted to manipulating Healthcare Locums’ accounts.
Jarvis admitted that her conduct “fell significantly short” of the standards to be expected of a member of the profession by “dishonestly manipulating HCL’s management accounts to increase its apparent profitability”, the FRS said. The management accounts were presented by Jarvis to external third parties as an accurate representation of HCL’s performance.
“The significant period of exclusion recommended in this case reflects the gravity of the misconduct and sends out a clear message to accountants in business of the importance of acting honestly and with integrity.
“The substantial sanction will also serve to protect the public and contribute to the maintenance of public confidence in the accountancy profession,” said Paul George, FRC executive director of conduct.
The medical staffing company issued a profit warning in 2011 and suspended trading in its AIM-listed shares after discovering “serious accounting irregularities”. Kate Bleasdale, its chief executive and founder, and Jarvis were forced to step down by the board.
Proceedings were filed against Jarvis, Bleasdale and ex-chairman Alan Walker, by a US consortium of shareholders. The charges were dropped and the proceedings were dismissed.
In May, the FRC scrapped its investigation into BDO’s role in signing off the accounts of Healthcare Locums after it concluded “there is not a realistic prospect that a tribunal would make an adverse finding” against the firm and individuals “in respect of the matters within the scope of the investigation”.