Leader – The spin has started to wobble

After the success of the profession’s regulatory review, the government has done little to endear itself to the profession over the last seven days.

First, trade secretary Stephen Byers announced plans to raise the audit threshold for companies, then it emerged that the DTI’s much vaunted reform of both the insolvency profession and the LLP status of firms would not find a place on New Labour’s crowded legislative timetable before the summer recess.

For a government that prides itself on presentation, none of these moves marks a triumph for spin. Instead, they smack of easy options.

In March, ministers excluded debate about the audit threshold from the company law review. But last Thursday, the political platform of the British Chambers of Commerce conference proved too great a temptation to Byers as he announced plans to raise the audit limit to as much as £4.2m – to the chagrin of most accountants.

As far as insolvency and LLPs are concerned, the effect is similar. Much was promised, and now nothing looks likely to be delivered – or at least not to a timetable that will satisfy the profession.

Of course there is vested interest at stake, as removing the profitable SME sector from firms’ paws will hurt. But when the finance director of a £4m company says no bank would lend him money unless he had annual audit, it is an issue that deserves greater scrutiny than it has got so far.

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