UK directors will be held responsible for the accuracy of the accounts

Posted on Feb 5, 2019 2021 at 11:59Updated Feb 5, 2019 2021 at 14:41

British companies are about to experience a real big bang in terms of auditing and corporate governance. Their directors will now be held personally responsible for the accuracy of the accounts through the approval of internal control and risk management. The obligation will weigh on each of them rather than on the boards of directors as a whole, and may give rise in the event of serious breach to fines or temporary prohibitions from practicing. Rules that are reminiscent of the Sarbanes-Oxley law implemented in the United States after the Enron affair.

According to the “Financial Times”, the British government is expected to announce the measure next week on the occasion of the publication of its much-awaited White Paper setting out its proposals to reform audit and corporate governance rules. A document of more than 200 pages prepared by the Ministry of Enterprises, Energy and Industrial Strategy, which formulates more than 100 recommendations to prevent the recurrence of scandals such as that of the bankruptcy of the construction giant Carillion, in January 2018… that did not see its auditor KPMG coming, subsequently accused of negligence.

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