PracticeAuditActivist investor to face Lords audit enquiry

Activist investor to face Lords audit enquiry

“The banking crisis is largely due to faulty numbers,” claims Tim Bush

A prominent city figure, who believes accounting standards are to blame for
the banking crisis, will give evidence to the House of Lords inquiry into the
audit industry tomorrow.

Tim Bush, a member of the Urgent Issues Task Force set up by the Accounting
Standards Board (ASB), believes international accounting standards overstated
profits in the lead up to the banking crisis.

Bush will appear before the Economic Affairs Committee looking into the
structure of the audit industry and the behaviour of auditors.

Bush believes international accounting standards, adopted in 2005, led to
“false profits” and “overstated assets” which then led banks to unfairly
distribute funds in the years before the crisis.

“Banks traded, priced credit and paid dividends when they weren’t really
making the ‘profits’ that they were showing and thought they were making,” he
said.

“The banking crisis is largely due to faulty numbers.”

Bush’s comments raised the ire of the ASB in August when chairman Ian
Mackintosh said the views were not widely held.

“In blaming the accounting standards Mr Bush is attempting to shoot the
messenger rather than deal with the true underlying causes of banking failure,”
Mackintosh said at the time.

Bush will join Jonathan Hayward, director with consultant Independent Audit;
Stephen Kingsley, director with professional services firm FTI Consulting; and
Dr Gunnar Niels of consulting firm Oxera.

Further reading:

Analysis:
IFRS will be big burden for SMEs

Related Articles

Don’t delay reporting changes warn firms

Accounting Standards Don’t delay reporting changes warn firms

6y Rachael Singh, Writer
Allow small listed firms to duck IFRS

Accounting Standards Allow small listed firms to duck IFRS

7y Kevin Reed, Writer
ASB's accounting proposals risk multi-tiered confusion

Accounting Standards ASB's accounting proposals risk multi-tiered confusion

7y Michael Goldstein
Standards chairman must be part-politician

Accounting Standards Standards chairman must be part-politician

7y Mario Christodoulou, Writer
Letter reveals internal concerns over new accounting code

Accounting Standards Letter reveals internal concerns over new accounting code

7y Mario Christodoulou, Writer
Replacement of UK GAAP must pass Government's cost benefit test, ASB warns

Audit Replacement of UK GAAP must pass Government's cost benefit test, ASB warns

7y Mario Christodoulou, Writer
Taxman urges delay of UK GAAP replacement

Audit Taxman urges delay of UK GAAP replacement

8y Mario Christodoulou, Writer
UK GAAP replacement timetable too ambitious: GT

Audit UK GAAP replacement timetable too ambitious: GT

8y Mario Christodoulou, Writer