If there is one branch of the profession that almost no one in business is ever pleased to see, it must be the insolvency practitioner. Liquidators only ever arrive when something has gone badly wrong. The owners of the business see their life’s work being broken up, staff fear for their homes and families and creditors are never satisfied with what they get.
In such circumstances, the insolvency practitioner deserves more protection than most. After all, plenty of people have some powerful incentives to make malicious allegations. But the very delicacy of the situation also argues strongly for the maintenance of the very highest standards.
Which is why the Insolvency Service’s proposals for a new regulatory structure for the profession are to be welcomed.
The new Insolvency Practices Council will go a long way towards allaying the considerable public disquiet that still exists about the conduct of insolvencies.
That such disquiet exists is something everyone involved must recognise, whether they think it is justified or not. Just like the endless debate about the auditing expectation gap, arguing about whether the criticism is fair is to miss the point. The cardinal principle of good regulation is that justice must not only be done but it must be seen to be done. The new non-accountant dominated council will go a long way towards silencing the profession’s critics.
But don’t expect it to make anyone glad to see the liquidator at their door.
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