Accountants have been lobbying the government for months as cases such as the dispute between Equitable Life and Ernst & Young highlight the problem faced by the audit industry.
A DTI spokeswoman said that there was ‘ongoing communication’ in the department and proposals were under ‘active consideration right now’. But she said it was important not to be premature when talking about specific timing for any legislation. ‘We are currently listening to the views of accountants’ she said.
Peter Wyman, PricewaterhouseCoopers partner and former ICAEW president, warned that the audit industry could suffer a ‘mass exodus’ if legislation is not introduced.
‘We are not saying that firms will decide automatically to stop auditing, but there may be forces we are unable to stop,’ he said. In an ideal world, the UK should follow the lead of Australia and introduce proportionality with a ‘catastrophe cap’, according to Wyman.
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