UK Considers Limits on Auditor Liability

The UK government proposed legislation which would limit the legal liability of auditors to those directly attributable to the auditor's work. The proposed legislation would have to be approved annually by corporate shareholders before applying to a specific audit; moreover, shareholders would be able to question auditors during shareholder meetings and fraud or grossly negligent reporting in an audit would be subject to criminal sanctions. The European Union has shown little interest in this sort of legislation.