P&O Ferries Engages Small Firm Just Audit Amid Governance Concerns

P&O Ferries, the well-known UK ferry operator, has appointed a small four-person accounting firm, Just Audit & Assurance, to replace KPMG, the Big Four accounting firm, as its auditor. This decision comes after KPMG resigned in March 2025, stating that it could not complete the audit of P&O Ferries’ 2023 accounts to the required standard within the management's desired timeline. The resignation of KPMG, which has previously provided auditing services to P&O Ferries, raised significant concerns regarding the governance and financial stability of the company, especially considering its troubled history of controversial management decisions, including the dismissal of 786 British workers in 2022 and the subsequent hiring of low-cost agency staff from overseas.

The governance issues surrounding P&O Ferries have intensified scrutiny in light of its delayed financial reporting. The company's 2022 accounts were published nearly 11 months late, revealing over £47 million spent on redundancy for UK seafarers. Currently, the 2023 accounts are already eight months overdue. According to the UK’s Companies House, failing to file accounts on time is a criminal offense, though penalties are often limited to fines.

Just Audit, based in Witney, Oxfordshire, will charge approximately £265,000 for the audit, which represents about 8% of its total revenues. The relatively small size of Just Audit—a firm with only four employees—has sparked concerns about auditor independence. Prem Sikka, a prominent accounting professor and Labour peer, highlighted that the significant fee could influence the audit approach, given that it constitutes a large portion of the firm's income. He stated, “There are serious questions about auditor independence. A small firm of four staff is auditing a giant conglomerate.”

Jonathan Russell, the majority shareholder of Just Audit, defended the firm's capability, asserting that his opinions will remain independent and not influenced by monetary considerations. He acknowledged the public's concerns about the firm's size but emphasized that the quality of audits does not necessarily correlate with the size of the auditing firm. Russell pointed to the need for thorough audits, citing past failures such as the collapse of Carillion, a construction company that misrepresented its financial health.

As P&O Ferries continues to navigate these turbulent waters, both financial analysts and the general public await the release of its 2023 accounts, which are expected by the end of the month. The outcome will significantly impact public perception and trust in the ferry operator, which transports over four million passengers each year and employs thousands.

In conclusion, P&O Ferries' decision to hire a small auditing firm raises critical questions about financial governance and transparency within the company. As the maritime transportation industry faces increasing scrutiny, the implications of this decision will extend beyond P&O Ferries, potentially affecting regulatory practices and investor confidence in the sector. The full ramifications of these developments will unfold as the company publishes its overdue financial statements and addresses the ongoing concerns regarding its operational practices and corporate governance.