Save content
Have you found this content useful? Use the button above to save it to your profile.
AIA

New Euro forum on auditors' liability

by
21st Nov 2005
Save content
Have you found this content useful? Use the button above to save it to your profile.

The European Commission is to set up a special forum to gather market players' views on limiting auditors' liability

It has drawn together 20 market experts from various professional backgrounds, including auditors, bankers, investors, companies, insurers and academics. The forum will consider ways of mitigating litigation risks.

Internal Market Commissioner Charlie McCreevy said: "No-one wants another corporate scandal that could reduce the 'big four' to the 'big three' ' especially audit firms themselves, who we know want to limit their liability for acts under their direct responsibility.

"Now that some EU countries already have limitations, or are moving in that direction, we think the time is ripe for EU-wide action. The forum's market experts will help us to analyse all the issues."

One of the forum's first tasks will be to provide the data for the Commission's planned study on the economic impact of alternative liability regimes, competition in the market and the availability of insurance.

The study will form the background to a report the Commission plans to issues before the end of 2006 into the impact of liability rules for carrying out statutory audits on European capital markets and insurance conditions. This report is part of the eighth Company Law Directive on statutory audit and may be followed by recommendations to member states.

Members of the forum are appointed until 31 December 2006. For further information on auditing in the EU click here

Tags:

Replies (1)

Please login or register to join the discussion.

avatar
By AnonymousUser
23rd Nov 2005 13:10

Limit Liability
Heritage plc and KPMG

https://www.accountingweb.co.uk/cgi-bin/item.cgi?id=144545&d=101&dateformat=%o-%B

I believe that auditors liability should be limited. I see no reason why ALL partners should suffer because some partners who they may never of even met are less than honest.

However, I also suggest that it should be made much easier to bring Criminal charges against auditors who mislead users of accounts signed off by them.

Jeff Lampert
(Former Chairman of Heritage plc)

Thanks (0)