Regulation fears aired
Senior accountants have warned the profession's new regulatory framework could lead to auditors becoming 'whipping boys' for corporate wrongdoing
Responding to proposals for independent regulation of UK accountants, unveiled by trade minister Ian McCartney on Monday (30 November), Roger Davis, head of professional affairs at PricewaterhouseCoopers, said the government had every right to crystal accountability from the profession. But he warned: ‘The system could be a misdirected effort if the auditors just become whipping boys for corporate wrongdoing.’
McCartney unveiled details of the framework at an English ICA conference and said he hoped it would be up and running by the millennium.
Concerns centred on the composition of the foundation – a body overseeing regulation and consisting of non-accountants nominated by bodies such as the Bank of England.
Three second-tier bodies will be made up of non-accountants on a 60:40 split, less than the 50:50 favoured by institute president Chris Swinson, who put forward the proposals.
An independent review board will act as a watchdog to the new bodies and the professional accounting bodies.
Anthea Rose, ACCA’s chief executive, said the framework was very close to the profession’s proposals and said ACCA welcomed them. She added: ‘We might have preferred a 50:50 split, but we can live with 60:40.’