A limited future

In all, 18 LLP certificates were issued by Companies House with that coveted
first certificate going to Ernst & Young – probably the most enthusiastic
lobbyist for what was, in those days, an exciting new corporate structure.

So where are we six years on? Well, almost half the firms in the Accountancy
Age Top 50 are now LLPs, with that number receiving a further boost at the
weekend with Baker Tilly taking the plunge. But the principal change is that
this alternative to the traditional partnership structure is no longer the only
option. Tenon and Vantis are both listed, with Smith & Williamson (still)
considering following suit.

And it’s these latter moves that make the former appear somewhat
old-fashioned. Now in the brave new world of accountancy firm ownership
structures, all bets are off.

For the time being firms can seek listings as long as their audit arms sit
outside that structure, as pioneered by Tenon, Vantis and Numerica, also in
2001. But even that could change, with the EU looking at alternative ownership
structures for audit firms and considering allowing them to raise capital on the
markets. Even if that doesn’t come off, proportionate liability was ushered in
the Companies Act.

Baker Tilly is keeping its options open under its new structure. Partners’
liability is protected as the wider liability debate beds down. Is audit arm
will sit under a holding company which, if the law changes, could raise external

So a not-unreasonable move by the firm then, though why didn’t it do so
earlier? We wouldn’t expect too many firms to follow suit at this stage but
partners will be watching developments in Brussels carefully. That seems to be
the ownership debate that matters – not LLP conversion.

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