Jeremy Newman, managing partner at BDO Stoy Hayward, has expressed his
concern at the creeping ‘Americanisation’ of audit standards, and weighed into
the debate on liability reform.
Responding to comments made in the Financial Times by the chief
executive officer of Morley Fund Management, Keith Jones, Newman said that the
differing legal frameworks in the UK and US made further alignment inappropriate
– ‘even ignoring the fact that the US “tick box” approach has been shown to be
flawed by numerous corporate collapses and scandals’.
However, he said it was incorrect to link this issue to the debate on
‘All interested parties, including investors, have previously agreed that the
current liability regime is flawed and needs to be changed,’ he said. ‘All
interested parties, including investors, have previously agreed that the
government’s proposals to introduce proportional liability are long overdue.
‘Investors, auditors, companies and the government should unite in addressing
the concerns over audit standards and should not fight over liability reform
that we have all agreed is necessary and desirable.’
He said that liability reform was not a ‘trade-off’ and that he felt the
current debate was in danger of making the issue of audit standards a
‘side-show’ when it was fundamental to the profession.
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