§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer if he will bring forward proposals for legislation under which auditors of insurance companies would be prohibited from recruiting company directors.
§ Mr. Neil HamiltonI have been asked to reply.
I see no reason to do so. Ethical guidance issued by the professional accountancy bodies states that no one should take part in the audit of a company if he has, during the period on which the report is to be made or at any time in the two years prior to the first day of that period, been an officer, other than auditor, or employee of that company. Under part II of the Companies Act 1989, recognised supervisory bodies are required to have adequate rules and practices as to professional integrity and independence.