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QUEEN’S SPEECH – THE GUIDE
Limited Liability Partnership Bill
Electronic Communications Bill
Government Resources and Accounting Bill
Local Government Bill
Regulatory Reform Bill
What our pundits said
The Queen said the government would bring forward the long-awaited Limited Liability Partnerships Bill, which many the accountancy profession have been quietly campaigning for over a period of many years.
It will give partnerships limited liability, but at the same time allow them to retain their organisational flexibility, and allow them to keep their internal partnership agreements confidential.
The structure will be available to two or more people. The details are set out in the latest draft of the Bill, which was published in July 1999.
This is described as legislation to assist the rescue of viable businesses in short-term difficulties, and improve the procedure for disqualifying unfit company directors.
The Insolvency Bill, which has caused much controversy among insolvency practitioners, will introduce a moratium for small companies in financial difficulty.
The Bill will also provide a power for the Secretary of State to require notice to be given before an administrative receiver is appointed.
Many IPs have expressed doubts over whether will the Bill work in practice.
This, according to the Queen’s speech, will ‘prepare Britain as a dynamic, knowledge-based economy’ and ‘improve its ability to compete in the digital marketplace.’
It will allow messages to be signed electronically so people would be able to check who sent the message and ensure it has not been tampered with.
A ‘kitemark’ system will be introduced to improve quality.
Obstacles in current laws insisting on the use of paper would be swept away.
Whitehall has been given the go-ahead to fully implement resource accounting and budgeting following the inclusion of a new Bill in the Queen’s speech.
It will put in place powers to enable the preparation and audit of consolidated accounts for the whole public sector. A central element in the modernising government agenda, RAB involves replacing the current system of cash appropriation accounts with accruals-based resource accounts which will follow best accounting practice.
Introduction of resource accounting will ensure the full economic cost of government activities are measured by including other costs not reflected in cash-based accounts, such as capital consumption.
Additionally, RAB will allow improvements in the treatment of capital spending. The government believes resource accounts will also improve transparency by making it easier to see what taxpayers are getting for their money.
Local government auditors are to lose their power to issue prohibition orders and instead will have to obtain court backing to block any local authority action that they feel might be illegal.
At the moment if an auditor is concerned about the legality of something a council is seeking to do he or she can prevent them from doing it by issuing a prohibition order.
But, in an attempt to clarify auditors’ powers, the new Bill will give auditors the power to issue advisory notices – allowing them time to seek a court’s decision about the legaility of what a council is seeking to do.
The changes stem from recommendations made in the 1997 Nolan committee report on standards in public life and comments made in the Westminster gerrymandering case that the council’s auditor had acted as both ‘judge and jury’.
This is aimed at cutting down on red-tape burdens by increasing the effectiveness of introducing powers to remove regulatory burdens.
The government announced plans in the Queen’s speech to take a leading role in the future development of the European Union with accountability at the top of the list.
The Queen said that the government supports an effective Europe with accountable, responsible, and well-run institutions and is awaiting a major programme of internal reform which will be unveiled by EC president Romano Prodi and vice president Neil Kinnock early next year.
The news is particularly timely given that the European Court of Auditor today refused to sign off the commission’s accounts for a fifth successive year.
All focused on the LLP Bill.
BDO Stoy Hayward tax partner Mark Lee, who was involved in the firm’s representations to the government on the LLP Bill :
On the inclusion of the LLP Bill in the Queen’s speech:
‘This is excellent news and is a good example of the government listening to the needs of business and in particular professional firms and it will enable them to adapt to a more modern business structure for the next century.‘
He added that the Bill had been in the wings for a long time and although there were a few issues still to be ironed out he was delighted with the announcement.
English Institute deputy president Graham Ward on the LLP Bill:
‘We were told that it had all-party support which was very positive and this is truly excellent news. There were some points of contention with the Bill but they were more clarification issues.‘
Gordon Horsfield, PricewaterhouseCoopers Director of Operations, on the LLP Bill:
‘After many years of pushing for the modernisation of UK partnership law we are obviously delighted by this announcement. It shows a real commitment to providing a modern business environment for professional firms whose services underpin the strength of the UK as a global business centre. Limited Liability Partnership legislation will help firms continue to attract, to develop and to retain the talent they need to serve clients’ needs.‘
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