§ Mr. BurnsTo ask the Chancellor of the Exchequer when he expects to bring forward proposals for imposing a duty on auditors of firms in the regulated sector to report to the regulators.
§ Mr. NelsonI am pleased to announce that a joint Treasury and Department of Trade and Industry consultation document is being published today. This includes draft regulations imposing a statutory duty on auditors to report to the Bank of England any information which they believe to be relevant to their client bank's fulfilment of the authorisation criteria in the Banking Act, in line with the recommendation made by Sir Thomas Bingham in his report of the inquiry into BCCI.
The consultation document also includes draft instruments extending a similar duty to report to the relevant regulatory authority, for auditors of building societies, friendly societies, persons regulated under the Financial Services Act, and at the initiative of my right hon. Friend the President of the Board of Trade, companies regulated under the Insurance Companies. Act.
The instruments which would implement the statutory duty have been drafted in close consultation with the auditing profession, with bodies representing regulated firms, and with the regulators.
Comments are requested on the consultation document by I June. When the Government have had time to consider these, we will prepare draft instruments to lay before the House. These should come into force before the end of 1993.
Copies of the consultation document have been placed in the House Libraries.