By Jo Best, 5 December 2003 15:00
NEWS Corporate governance is set to be pushed to the top of the boardroom agenda today, after laws to prevent another WorldCom or Enron scandal made it through the House of Lords.
The Companies (Audit, Investigations and Community Enterprise) Bill, published on Thursday, is designed to restore investor confidence in UK companies' auditing, accounting and financial reporting.
The Bill strengthens investigatory powers for those looking into any corporate wrongdoing, including making refusal to supply information contempt of court, provide immunity from breach of confidence for individuals giving information and give the investigators greater powers to gather evidence. The end result? If you don't co-operate when the investigators come round, you could be facing a fine or some jail time.
The Bill will also put more responsibility on bosses and the companies themselves forcing them to promise they haven't withheld information from auditors and obliging companies to publicly reveal if their auditors have provided any services other than auditing.
While the thought of more red tape will doubtless not impress directors they may have to pay for the privilege into the bargain. Companies may be forced to pay up in order to bankroll the Financial Reporting Council if voluntary arrangements don't work out.
Comments
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1. Paul Neale
"Companies may be forced to pay up in order to bankroll the Financial Reporting Council if voluntary arrangements don't work out."
With this initiative being a Government move "...designed to restore investor confidence in UK companies' auditing, accounting and financial reporting." -shouldn't the Government pay for it centrally?
After all, they're going to get more taxation from any resultant growth.
2. JenChris
The cumulative amount of red tape reporting , tax burden etc effectively mean the end of many established and new business in the UK over the next 10 years. Even if I'm wrong why put up with all the hassle to loose it all in direct and indirect taxation??? All that has come out of this type of regulation is to stifle the majority on the actions of the minority , grow the civil service and goverment related bodies at the expense of the economy. Keep your company private and never float - if you need capital do it without going public.
Another good reason to relocate your business out of the UK.