Auditors win liability victory but at a price

Auditors win liability victory but at a price

The profession is set to win its battle for proportionate liability, after it emerged that new amendments to the company law reform bill were likely to be published this week

The changes had been in doubt after last week’s cabinet reshuffle, which saw
Alistair Darling (pictured) take over as secretary of state at the DTI.

The current wording of the company law reform bill had led to fears that
auditors would be forced to negotiate a monetary liability cap with clients,
rather than on the hoped for proportionality basis.

But it is understood that the DTI has been working tirelessly behind the
scenes to ensure the amendments go ahead.

The victory for auditors, will come at a price for large firms, however.
Further amendments are to be introduced that will allow the government to remove
any agreement where there appears to be concern over competition.

A DTI spokesman said the department was looking to bring forward amendments
to clarify the audit liability issue. The spokesman added that there was, as
yet, no confirmed timetable for making the changes.

For more, visit dti.gov.uk

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