Autonomy, the software vendor led by Dr Mike Lynch (pictured) and bought by HP for $10.3bn (£7.1bn) in 2011, is to be investigated over allegations of accounting irregularities.
The Financial Reporting Council (FRC) has revealed it has launched an investigation into Autonomy's published financial results between the start of 2009 and 30 June 2011, the 18-month period before HP bought out the data governance firm.
The FRC has so far refused to state whether the investigation covers just Autonomy itself, or whether inquiries extend to accountants Deloitte, which was Autonomy's auditor at the time of the HP acquisition.
A spokesman for Autonomy said it would "welcome" the investigation. "Autonomy received unqualified audit reports throughout its life as a public company," it said in a statement.
"This includes the period in question, during which Autonomy was audited by Deloitte. We are fully confident in the financial reporting of the company and look forward to the opportunity to demonstrate this to the FRC."
Autonomy, and its founder Lynch, has already been accused by HP of artificially raising the company's value just prior to the takeover in 2011. HP has since written down £5bn from Autonomy's value. Lynch is believed to have netted around £500m from the company's sale.
Depending on its findings, the FRC potentially has the power to impose an unlimited fine on a company, or to remove an individual from a professional body. It cannot, though, invoke criminal or civil charges.
However, the FRC could pass its findings on to the Serious Fraud Office, which HP consulted back in November 2012, or any number of other UK regulators.
The US Department of Justice is also in the middle of an investigation into Autonomy as a result of HP's claims.
Just days ago, it was reported that Lynch had raised £1bn for a new UK-based venture fund, called Invoke Capital, which will seek to invest in British technology startups. Invoke's website states that Lynch and his team "managed Autonomy's rise... with an acquisition value of $12bn [£7bn]".
By eliminating high entry costs for big data analysis, you can convert more raw data into valuable business insight.
A discussion of the "risk perception gap", its implications and how it can be closed