LONDON, (Reuters) – Deloitte’s audit partner John Charlton and Deloitte were fined and harshly reprimanded for their 2016 audit of Mitie (a British outsourcing firm), the Financial Reporting Council (FRC), auditing watchdog, said Thursday.

Deloitte was penalized 2,000,000 pounds. This was reduced to 1.45million by Charlton. Charlton was also fined 65,000, which was reduced to 40,006 pounds because of admissions and mitigating circumstances.

Each admitted they broke the requirements for their audit of Mitie’s impairment test of goodwill within the healthcare division. The FRC reported that this led to a materially uncorrected error in the full year 2016 results.

FRC said that the FRC did not believe that any breach was intentional, dishonest, reckless or that it had resulted in financial gain.

Mitie’s financial results for 2016 showed that 465.5 million pounds was attributed to goodwill. This figure is the largest in the balance sheets and accounts for 37.5%. In 2016, 107.2 Million was reported as goodwill within the healthcare unit. This is 23% more than the total assets.

Deloitte identified a major risk in recovering the goodwill of the healthcare division.