The accountancy firm KPMG is to be investigated by the UK’s Financial Reporting Council over its role in the collapse of construction firm Carillion

The business secretary, Greg Clark, welcomed the investigation, which the accounting watchdog said followed inquiries made since Carillion’s profit warning in July. The FRC said it would conduct the investigation, which will cover 2014 to 2016 and additional audit work carried out during 2017, “as quickly and thoroughly as possible”.

Carillion, which was involved in the HS2 rail link and the revamp of Battersea Power station, as well as providing services such as cleaning prisons, went into compulsory liquidation two weeks ago with debts of £1.3bn, a pension deficit of nearly £1bn and a host of unfinished public contracts.