DTI signals climbdown over liability cap fears
Fears of cap negotiations allayed after talks with government
Fears of cap negotiations allayed after talks with government
Fears that government intransigence over the wording of auditor liability
legislation could force accountants to negotiate caps against their wishes have
been allayed following talks with the profession.
The Department of Trade and Industry remains convinced that clauses on
liability limitation, as they currently stand, allow for the negotiation of
proportionate liability without having to mention a cap, but it has signalled a
willingness to alter them if concerns remain.
‘As it stands we believe it is properly drafted but specific concerns about
the exact phraseology have been raised,’ said a DTI spokeswoman.
‘We are talking to auditors about that and if it emerges that a slight
re-wording to clarify that point is necessary, then we will do so, although our
advice at the moment is that it does do what auditors want it to do when they
asked for the cap,’ she said.
The move signals a climbdown from the department’s previous stance, and
should provide much relief to the profession. Following legal advice on the
wording of the clauses, the country’s biggest auditor was concerned that it
might be forced to negotiate a monetary cap with audit clients rather than
proportionality.
Gerald Russell, senior partner at Ernst & Young, said: ‘This is a
sensible point of view and from the profession’s point of view some tweaking is
needed to establish the government’s intentions when Patricia Hewitt announced
it.’
The numbers you crunch tell a story. Your expertis...
18yEmbracing user-friendly AP systems can turn the tide, streamlining workflows, enhancing compliance, and opening doors to early payment discounts. Read...
View articleOrganisations can enhance their financial operations' efficiency, accuracy, and responsiveness by adopting platforms that offer them self-service cust...
View articleIn a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...
View resourceDiscover how AP dashboards can transform your business by enhancing efficiency and accuracy in tracking key metrics, as revealed by the latest insight...
View articleThe Bank of England has appointed Ernst and Young LLP (EY) as its external auditor from the financial year ending 28 February 2025. Read More...
View articleThis follows an investigation into undisclosed personal loans and issues with an acquisition. Despite challenges, the company aims to achieve £1bn in ...
View articlePwC's decision to delay promotions in its graduate scheme, affecting around 100 graduates, is a response to reduced client demand and the aftermath of...
View articleTraditionally, audit schedules have been prepared manually, consuming significant time and resources. However, with the advancements in Artificial Int...
View articleThe FRC is promoting initiatives to foster a more competitive market, following recent high-profile accounting scandals. Read More...
View articleOn January 27, it was reported EY had quit as auditor to Asda amid one of its senior partners starting a romantic relationship with billionaire chief ...
View articleDespite the increased interest in AI and ML, only 12% of respondents indicate their organisations have adopted AI and ML within their audit functions....
View articleAs the government's independent investigation progresses, it is hoped that a clearer picture will emerge, leading to meaningful reforms within the aud...
View article