diff --git a/CHANGELOG.md b/CHANGELOG.md
index dbb56c0..1d7781a 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,3 +1,9 @@
+## v0.7.4 (2026-04-17)
+
+### Fix
+
+- fix failures not being properly audited in foundry pipeline
+
 ## v0.7.3 (2026-04-16)
 
 ### Fix
diff --git a/pyproject.toml b/pyproject.toml
index 26071f8..d76f647 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -24,7 +24,7 @@ Issues = "https://github.com/NHSDigital/data-validation-engine/issues"
 Changelog = "https://github.com/NHSDigital/data-validation-engine/blob/main/CHANGELOG.md"
 
 [tool.poetry]
-version = "0.7.3"
+version = "0.7.4"
 packages = [
     { include = "dve", from = "src" },
 ]
diff --git a/src/dve/pipeline/foundry_ddb_pipeline.py b/src/dve/pipeline/foundry_ddb_pipeline.py
index 21cac56..a5c2463 100644
--- a/src/dve/pipeline/foundry_ddb_pipeline.py
+++ b/src/dve/pipeline/foundry_ddb_pipeline.py
@@ -152,6 +152,9 @@ def run_pipeline(
                 )
                 if sub_stats:
                     self._audit_tables.add_submission_statistics_records(sub_stats=[sub_stats])
+            else:
+                self._audit_tables.mark_failed(submissions=[sub_id])
+
         except Exception as err:  # pylint: disable=W0718
             self._logger.exception(
                 f"During processing of submission_id: {sub_id}, this exception was raised:"
diff --git a/src/dve/pipeline/pipeline.py b/src/dve/pipeline/pipeline.py
index b14ada1..26b682e 100644
--- a/src/dve/pipeline/pipeline.py
+++ b/src/dve/pipeline/pipeline.py
@@ -527,7 +527,7 @@ def data_contract_step(
 
         return processed_files, failed_processing
 
-    def apply_business_rules(
+    def apply_business_rules(   # pylint: disable=R0914
         self, submission_info: SubmissionInfo, submission_status: Optional[SubmissionStatus] = None
     ) -> tuple[SubmissionInfo, SubmissionStatus]:
         """Apply the business rules to a given submission, the submission may have failed at the
@@ -581,15 +581,23 @@ def apply_business_rules(
 
         key_fields = {model: conf.reporting_fields for model, conf in model_config.items()}
 
-        self.step_implementations.apply_rules(working_directory, entity_manager, rules, key_fields)  # type: ignore
+        _errors_uri, rules_success = self.step_implementations.apply_rules(  # type: ignore
+            working_directory,
+            entity_manager,
+            rules,
+            key_fields
+        )
 
         rule_messages = load_feedback_messages(
             get_feedback_errors_uri(working_directory, "business_rules")
         )
-        submission_status.validation_failed = (
+        if (
             any(not rule_message.is_informational for rule_message in rule_messages)
             or submission_status.validation_failed
-        )
+        ):
+            submission_status.validation_failed = True
+        elif not rules_success:
+            submission_status.processing_failed = True
 
         for entity_name, entity in entity_manager.entities.items():
             projected = self._step_implementations.write_parquet(  # type: ignore
diff --git a/tests/test_pipeline/test_foundry_ddb_pipeline.py b/tests/test_pipeline/test_foundry_ddb_pipeline.py
index 12a7fd1..350b990 100644
--- a/tests/test_pipeline/test_foundry_ddb_pipeline.py
+++ b/tests/test_pipeline/test_foundry_ddb_pipeline.py
@@ -192,3 +192,39 @@ def test_foundry_runner_with_submitted_files_path(movies_test_files, temp_ddb_co
         assert fh.get_resource_exists(report_uri)
         assert len(list(fh.iter_prefix(output_loc))) == 2
         assert len(list(fh.iter_prefix(audit_files))) == 3
+
+
+def test_foundry_runner_error_at_bi_rules(movies_test_files, temp_ddb_conn):
+    # Missing refdata in the business rules should cause a handled failure
+    db_file, conn = temp_ddb_conn
+    processing_folder = Path(tempfile.mkdtemp()).as_posix()
+    submitted_files_path = Path(movies_test_files).as_posix()
+    sub_id = uuid4().hex
+    sub_info = SubmissionInfo(
+        submission_id=sub_id,
+        dataset_id="movies",
+        file_name="good_movies",
+        file_extension="json",
+        submitting_org="TEST",
+        datetime_received=datetime(2025,11,5)
+    )
+
+    DuckDBRefDataLoader.connection = conn
+    DuckDBRefDataLoader.dataset_config_uri = None
+
+    with DDBAuditingManager(db_file.as_uri(), None, conn) as audit_manager:
+        dve_pipeline = FoundryDDBPipeline(
+            processed_files_path=processing_folder,
+            audit_tables=audit_manager,
+            connection=conn,
+            rules_path=get_test_file_path("movies/movies_ddb.dischema.json").as_posix(),
+            submitted_files_path=submitted_files_path,
+            reference_data_loader=DuckDBRefDataLoader,
+        )
+        output_loc, report_uri, audit_files = dve_pipeline.run_pipeline(sub_info)
+
+        assert Path(processing_folder, sub_id, sub_info.file_name_with_ext).exists()
+        assert output_loc is None
+        assert len(list(fh.iter_prefix(audit_files))) == 2
+        assert audit_manager.get_submission_status(sub_id).processing_failed
+        assert audit_manager.get_latest_processing_records().select("submission_result").pl().to_dicts()[0]["submission_result"] == "processing_failed"