Auditor's liabilities - a new chapter begins
Article Abstract:
The lawsuit by Ferranti PLC claiming damages against Peat Marwick McLintock, former auditors for International Signal and Control, may eventually total 400 million pounds sterling. The claim hurts the accounting profession by creating liability for normal auditing activities that fail to uncover fraud. Besides extending auditors' liability for detecting fraud, the case will have an adverse effect on insurance rates because it will increase premiums. A Department of Trade and Industry-commissioned report by Andrew Likierman on professional liability published in Dec 1989 recommends that liability damages be limited to the extent that auditor's actions contributed to loss and urges revision of joint and several liability under which auditors must pay full damages even if only partially at fault. The report also recommends that the 1985 Companies Act be amended to revise joint and several liability, a measure the government does not support.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1990
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The auditors' dilemma
Article Abstract:
The British public is growing disatisfied with the quality of service provided by accountants, according to a study conducted by market researcher Glanville Partnership. Most accounts users doubt their auditors' concern for the shareholders' interest. The widespread distrust of auditors is changing the nature of the auditor-client relationship. Auditors no longer enjoy the commercial advantage of the audit. Companies are demanding more from their auditors in matters other than fees. Audit fees are being cut radically, particularly when services are put to tender, to attract clients. The combination of negative public perception and the recession is drastically reducing the audit margins. Members of the accountancy profession believe that the performance of audit firms will improve, but they would need to expand their services, differentiate themselves and create a demand for their expertise.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1992
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Success on the menu
Article Abstract:
Leith Catering has been awarded the contract to take care of the catering requirements of the Institute of Chartered Accountants in England and Wales. The company, which is part of the Leith Group founded by prominent gourmet Prue Leith, shall also take over the management of the restaurant in the Institute's Chartered Accountants' Hall. The Leith Group enjoys an annual turnover of 9 million pounds sterling and includes the famed Leith's Restaurant and the highly-respected Leith School of Food and Wine. The Leith Group also handles other catering contracts through Leith's Good Food Ltd, which specializes in providing for the catering needs of City businesses.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1992
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