RegulationAccounting StandardsTreasury panel fails to agree on auditor liability

Treasury panel fails to agree on auditor liability

A US Treasury panel fails to reach consensus on auditor liability

US auditors remain vulnerable to legal action after a Treasury Department
panel failed to deliver any effective recommendations which would protect
accounting firms from lawsuits threatening to close down their businesses.

The 21-member panel convened to improve the accounting profession was unable
to agree on whether the current system was fair and rational or whether auditors
needed protection from class-action lawsuits,
Reuters
reports.

The big four firms left after Arthur Andersen’s collapse in the wake of the
Enron scandal and a series of mergers audit 98% of US companies, recording
annual revenues of more than $US1bn, according to the US government.

The panel did make some non-binding recommendations for areas which did not
include auditor liability and suggested the industry agree on an action plan for
troubled public company auditing firms and recommended the Public Company
Accounting Oversight Board should monitor potential sources of ‘catastrophic
risk at auditing firms to prevent reduced auditor choice and significant market
disruptions’.

Further reading:

Court upholds $US183m award against
PwC

UK and US part ways over Enron response

Related Articles

Demystifying GDPR for accountants

Accounting Standards Demystifying GDPR for accountants

1w Ellen Temperton, Lewis Silkin
EY fined £1.8m over Tech Data audit

Accounting Standards EY fined £1.8m over Tech Data audit

2m Emma Smith, Managing Editor
The great professional services shake-up

Accounting Standards The great professional services shake-up

3m Fergus Payne, Lewis Silkin
What do clients actually want from an accountant?

Accounting Standards What do clients actually want from an accountant?

4m Emma Smith, Managing Editor
Accountants shouldn’t neglect hybrid mismatch anti-avoidance rules

Accounting Standards Accountants shouldn’t neglect hybrid mismatch anti-avoidance rules

4m Alison Conley
Membership of the accountancy profession on the rise

Accounting Standards Membership of the accountancy profession on the rise

5m Alia Shoaib, Reporter
The real price of mates' rates in the provision of professional services

Accounting Standards The real price of mates' rates in the provision of professional services

5m DAC Beachcroft
IASB overhauls insurance accounting with issuance of IFRS 17

Accounting Standards IASB overhauls insurance accounting with issuance of IFRS 17

7m Alia Shoaib, Reporter