PracticeAccounting FirmsFirms may face tough new DTI powers

Firms may face tough new DTI powers

Tough new powers requiring accountants to co-operate in company investigations are being considered as part of a further shake up of company law being considered by the Department of Trade and Industry.

Company advisers, including accountants, auditors, actuaries, banker and lawyers may be caught up in investigations under the new regime proposed from within the Companies Investigation Branch.

But the accountants and other professionals concerned may have to be named at the outset of an inquiry to make it clear who may be involved in an investigation.

The drastic shake up follows mounting concern at the length and cost of some investigations – particularly that of Mirror Group Newspapers, which took nearly nine years and cost Pounds 9.6m.

Officials are also concerned that the regime should do more to bolster the government’s campaign against fraudulent conduct and organised crime.

It proposes widening the scope of inquiries to include the businesses and affairs of individuals and partnerships and subsidiaries associated a company subjected to an inquiry. New powers should include a right for inspectors to enter company premises on two days notice to inspect records – with a warrant where entry is resisted; and to impose interim restraining orders during investigations to safeguard creditors, customers and members.

Other powers may include a gagging order for anyone questioned during a confidential investigation to prevent information becoming public.

Another proposed measure is the creation of the power to sack a director against whom there is insufficient evidence for a disqualification.

Officials propose ending the criminal sanction for non compliance – leaving it to the civil courts to enforce co-operation – but keeping criminal sanctions for destroying, mutilating or fabricating evidence.

The DTI is seeking comments by the end of January 2002, with notice where possible by 4 January – suggesting the possibility of legislation in the Queen’s Speech next autumn with enactment during the 2002-3 parliamentary year.

LinksAccountanyAge.com’s Company Law Review special report

Related Articles

Johnston Carmichael CEO appointed as ICAS president

Accounting Firms Johnston Carmichael CEO appointed as ICAS president

3w Emma Smith, Managing Editor
British Accountancy Awards 2018 – entries open!

Accounting Firms British Accountancy Awards 2018 – entries open!

1m Emma Smith, Managing Editor
Is the accountancy sector facing an international talent crisis?

Accounting Firms Is the accountancy sector facing an international talent crisis?

1m Lewis Silkin
RSM appoints new Chief Operating Officer

Accounting Firms RSM appoints new Chief Operating Officer

1m Alia Shoaib, Reporter
RSM announces 11 partner promotions

Accounting Firms RSM announces 11 partner promotions

2m Emma Smith, Managing Editor
BDO hires former AstraZeneca creative director as head of digital and innovation

Accounting Firms BDO hires former AstraZeneca creative director as head of digital and innovation

2m Emma Smith, Managing Editor
What does the future hold for listed accountancy firms?

Accounting Firms What does the future hold for listed accountancy firms?

2m Fergus Payne, Lewis Silkin
EY, Deloitte lead Big Four in gender pay gap reporting

Accounting Firms EY, Deloitte lead Big Four in gender pay gap reporting

2m Emma Smith, Managing Editor