OFT under pressure for auditor liability decision
The Office of Fair Trading has just over three weeks to determine whether allowing auditors to limit their liability with companies will harm competition within the market.
Link: Liability cap: a special report
Industry and regions minister Jacqui Smith’s decision to draft in the help of the OFT and ask it to report back by the end of July offered a clear indication that the government intends to get liability cap legislation into the current companies bill.
Despite the tough schedule, a spokesman for the OFT said it was confident it could meet the deadline. ‘I don’t think we will be gathering any fresh information as the timescale doesn’t really allow for it,’ he said.
Eric Anstee, ICAEW chief executive, expressed his disappointment that nothing had so far gone through. ‘The government should act now to allow auditors to limit their liability,’ he said.
Neil Lerner, head of risk management and a board member at KPMG, said: ‘We are confident that the OFT will support our view that reform will actually increase the possibility of more competition for public company audits.’
The companies bill is due to reach the House of Commons when it returns from recess in September and it is understood that any final amendments will have to be made before the end of September.