But even when this guidance is released ­ and it is unlikely to come out this year ­ the greater concern for auditors is that companies still seem unconvinced that they should limit liability at all, whether there is a framework in place or not.

The Financial Reporting Council, the body responsible for guidance on the Companies Act provisions for auditor liability, has already received submissions from the Confederation of British Industry expressing uncertainty over the idea of auditor liability.

‘The final guidance should seek to give more assistance to boards on why they may consider it is in the company’s interests to recommend a limitation of liability arrangement,’ the CBI’s submission on the first draft of the FRC’s guidance stated.

A separate industry source echoed this view: ‘They failed to positively make a case as to why companies should accept limited liability arrangements. It’s seen by some as an attempt to push through a menu of choices without clear understanding and careful thought about why companies should accept this.’

These responses will not be well received by auditors. The expectation that all companies would accept liability contracts as a fait accompli once a framework was in place has not been met.

One way to change this view could be to focus on tightening up the guidance in future drafts.

Herbert Smith partner Hardeep Nahal, said the draft guidance was ‘quite vague’ and ‘left a lot of questions unanswered’.

‘The key issue is on what basis directors of companies can say that entering into a limited liability contract is in the best interest of the company. One argument I’ve heard is that in return, companies might get lower audit fees ­ but that’s not a good argument because firms are not putting this out to get lower fees,’ Nahal said.

The other contention is that directors should somehow consider the interest of the wider business community, due to concerns over the impact of one of the Big Four going under. ‘But that’s a pretty tenuous argument, asking people to take a wider view,’ said Nahal.

The profession’s battle to convince the markets to opt for limited liability contracts are far from over.