PracticeAccounting FirmsOFT says audit cap effect would be ‘neutral’

OFT says audit cap effect would be 'neutral'

The Office of Fair Trading's inquiry into competition issues surrounding the possible introduction of an cap on auditor liability has said the impact would be 'neutral'.

Link: Liability cap special report

In a statement, it said: ‘The OFT has not found compelling arguments to support claims that a cap on auditors’ liability would have pro-competitive effects on the audit market. It is likely that allowing audit caps would be competitively neutral overall.

The OFT did not find any compelling evidence that a cap would reduce barriers to entry and growth facing smaller audit firms, maintain competition between larger audit firms or reduce the risk of collapse of one of the Big Four.

But it did add: ‘Some forms of cap design could distort competition, so it will be important to ensure that there are no anti-competitive effects if scope for caps is allowed.’

Related Articles

BDO’s global revenues pass $8bn

Accounting Firms BDO’s global revenues pass $8bn

5d Alia Shoaib, Reporter
Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

Accounting Firms Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

1w Philip Smith, Reporter
Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

Accounting Firms Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

1w Emma Smith, Managing Editor
BDO reports revenue growth of 5.7%

Accounting Firms BDO reports revenue growth of 5.7%

2w Alia Shoaib, Reporter
Taylorcocks announces merger with Surrey firm

Accounting Firms Taylorcocks announces merger with Surrey firm

2w Emma Smith, Managing Editor
Kingston Smith reports 7% gender pay gap

Accounting Firms Kingston Smith reports 7% gender pay gap

2w Emma Smith, Managing Editor
RSM announces two partner promotions

Accounting Firms RSM announces two partner promotions

3w Emma Smith, Managing Editor
Backsourcing: The latest accountancy trend?

Accounting Firms Backsourcing: The latest accountancy trend?

1m Pillsbury Winthrop Shaw Pittman