The mid-tier firm has criticised the urgent issues task force of the Accoutning Standards Board just as the ASB has closed its consultation period on the proposals.
An EBT, as the trusts are known, is essentially independent of a company and used to benefit a company’s employees. The trustees, often based overseas, do not have to follow the wishes of the company.
Richard Karmel, corporate finance partner at Moores, told AccountancyAge.com: ‘It could disguise the face that there are technically insolvent companies if we add the EBT’s assets to the company accounts.’
Moores also argues that the ASB’s proposals are incompatible with the Companies Act and would take legal control away from the trustees.
Karmel added: ‘Our concern is that issuing standards and abstracts that are inconsistent with company and trust law will not only lead to confusion but even more worrying, will increase the potential for abuse. This can only reflect poorly on our industry as a whole.’
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