The Financial Reporting Council's plans to ensure it will never pay costs on disciplinary cases offend 'natural justice', senior sources in the profession have said, as disillusionment with its new disciplinary body grows.
There are two obvious responses:
1) As ever with the profession, do not complain, propose something better, and
2) They're right: this is wrong. The FRC could mount a false accusation which might be maliciously intended (sorry - I do not think this beyond the bounds of credibility in a system that is far from being properly regulated and is, in effect, an old boy's club) so protection is needed.
My answer: apportion costs to those likely to suffer complaint. That's a small sum to all those regulated and a lot bigger sum to those most likely to be seriously accused, who must be those with public interest auditing and accounting profiles. This has to be right: the The Accountancy & Actuarial Discipline Board says:
The focus of the AADB is on cases of public interest; other cases will continue to be dealt with by the individual accountancy body of the member concerned or by the Faculty & Institute of Actuaries.
There is of course one problem. As Prem Sikka has often pointed out, the FRC has no idea what the public interest means. My experience of dealing with them certainly suggests that to be true.
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