The FRC’s plans to ensure it will never pay costs on disciplinary cases
offend ‘natural justice’, senior sources in the profession have said, as
disillusionment with its new disciplinary body grows.
Last week, the Accountancy and Actuarial Discipline Board unveiled plans that
would mean that defendants who clear their names will only receive costs if the
AADB is guilty of ‘misfeasance’, thought to be an impossibly high barrier.
A senior member of the profession slated the idea this week, saying that
‘natural justice requires that whoever loses pays costs’.
‘Misfeasance’ constitutes an offence greater than simply negligence or the
AADB finding its charges do not stick, but requires costs claimants to prove
there has been some deliberate and dishonest use of office.
The proposals follow a £1m cost award to PricewaterhouseCoopers and others
when the AADB’s case against the firm over Mayflower failed. At the time, claims
for costs had not been budgeted for by the FRC.
The board has also proposed the formation of a Decisions Disciplinary
Committee, which will also be subject to the rules regarding circumstances of
‘If they take us to a tribunal and win, then we pay the costs. Why shouldn’t
it work the other way around? It seems a matter of principle that you don’t bear
the costs if you haven’t done anything wrong. It is enshrined in law in the
The costs issue could lead to broader disillusionment with the tribunals
process. The firms were not keen on the Joint Disciplinary Scheme, which also
denied defendants costs.
MHA MacIntyre Hudson has partnered with cloud accounting software provider Xero ahead of the government’s requirement for digital records
Smaller businesses could be excluded from government plans for making business transactions digital, found new research from ICAEW
Further powers are being sought by HMRC, but it is ‘failing’ to use those it already has, such as Conduct Notices, says RPC
HMRC breaches client confidentiality; and partner profits fall at EY. These stories and more discussed in Friday Afternoon Live