Schapiro is key to liability battle

The department for business has been called upon to target chief US
financial regulator Mary Schapiro in an attempt to push the US authorities to
accept limited liability agreements for auditors.

The call comes from experts on a group set up by the chancellor Alistair
Darling to make proposals for improving the competitiveness of UK professional

Limited liability agreements would allow auditors to cap their liability on a
proportional basis. The Securities and Exchange Commission, where Schapiro is
chairman, said it would not accept such agreements for overseas companies also
registered on US markets ­ around half the FTSE 100.

In its report the group ‘notes the opportunity presented by the change of
leadership at the SEC and urges the department of business, enterprise and
regulatory reform to continue to press the SEC to approve the principles of

But Michael Snyder, co-chairman of the group and head of Kingston Smith, said
there was concern that no UK-listed company had struck an agreement with its
auditor despite being able to do so since April last year. He said a
re-examination of LLAs was needed ‘as soon as possible’.

Related reading