The news also follows the Big Five firm's swift, but reluctant, u-turn on its decision to separate its consulting arm from its audit business as a result of events surrounding the Enron collapse.

A spokesperson for Deloitte & Touche said: 'There is an LLP review which is ongoing. The firm started looking at it in the last few months.'

Ernst & Young became the first UK firm to adopt LLP status last year. KPMG said in January that it too is set to become a LLP in the spring. Last month PwC said it would take on LLP status in July this year, and is likely to publish its UK accounts in 2003.

Firms have been able to register for LLP status since 6 April 2001 following the enactment of legislation introduced in 2000.

Under the current system for partnerships, all partners of a firm can be held 'joint and severally' liable for any action brought against the firm.With a steep rise in litigation becoming an LLP appears to be the best way for firms to reduce their liability against lawsuits.