Government accused of audit cap 'mockery'
The government has been accused of using the latest Companies Bill to make a mockery of its own consultation exercise on auditor and director liability.
The government has been accused of using the latest Companies Bill to make a mockery of its own consultation exercise on auditor and director liability.
Link: In depth: Liability cap
The charge came from shadow trade minister Andrew Mitchell after trade secretary Patricia Hewitt delivered a written Commons statement killing hopes of cap on auditor liability but leaving open the prospect of limiting it proportionally.
Mitchell lashed the bill as ‘deeply flawed and often poorly drafted’ and protested that the auditor liability issues was ‘a glaring omission’.
He said the problem was ‘a real threat to the stability of the audit profession’ and accused the government of responding ‘very negatively’.
Lib Dem spokesman Brian Cotter said proportionate liability would carry the support of business and the profession and called on the government to commit to it.
Trade minister Jacqui Smith – challenged by Labour MP Jim Cousins, a member of the treasury committee – said the government has not closed its mind to a statutory ban on auditors supplying non-audit services or ‘anything which helps us to improve confidence in both financial reporting and the quality of audit’.
She made it clear there was no carte blanche for proportionate liability proposals. Ministers would want to ensure audit quality was driven up and the competitive position of the audit market improved.
Tory accountant MP Mark Hoban had earlier urged the government to accept the conclusions if the industry reached consensus.
The numbers you crunch tell a story. Your expertis...
20yEmbracing 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