The CIOT and ATT have responded to the Department for Business, Energy & Industrial Strategy (BEIS) consultation on restoring trust in audit and corporate governance noting that, although this was not a consultation about tax as such, there appears to be some cross-over with the separate initiatives to raise standards in the tax advice market.
The consultation, which closed on 8 July 2021, sought views on proposals to strengthen the UK’s audit, corporate reporting and corporate governance systems, particularly focusing on the framework for major companies and the way they are audited.
The CIOT and ATT highlight the reference to the tax advice market in para 11.1.7 of the consultation document. That paragraph deals with professional bodies and suggests that ‘the existing self-regulatory regime does not operate completely satisfactorily’ particularly in relation to money laundering, tax avoidance and ‘poor practices in the tax advice market’. The CIOT/ATT suggest that, in the context of the consultation document – the focus of which is on audit and corporate governance rather than tax – the tax market points are effectively being used as part of BEIS’s assessment of the state of the audit market. In reality, note the CIOT/ATT, the position in the tax market is very different.
The CIOT/ATT consider that tax should not be included within the remit of the Audit, Reporting and Governance Authority (ARGA) (which will be the successor body to the Financial Reporting Council). Problems within the tax advice market are distinct from those noted as affecting the audit market and are already being addressed by HMRC in the consultation ‘raising standards in the tax advice market’ and also the consultation on whether professional indemnity insurance should be mandated for tax advisers.
The CIOT and ATT have responded to the Department for Business, Energy & Industrial Strategy (BEIS) consultation on restoring trust in audit and corporate governance noting that, although this was not a consultation about tax as such, there appears to be some cross-over with the separate initiatives to raise standards in the tax advice market.
The consultation, which closed on 8 July 2021, sought views on proposals to strengthen the UK’s audit, corporate reporting and corporate governance systems, particularly focusing on the framework for major companies and the way they are audited.
The CIOT and ATT highlight the reference to the tax advice market in para 11.1.7 of the consultation document. That paragraph deals with professional bodies and suggests that ‘the existing self-regulatory regime does not operate completely satisfactorily’ particularly in relation to money laundering, tax avoidance and ‘poor practices in the tax advice market’. The CIOT/ATT suggest that, in the context of the consultation document – the focus of which is on audit and corporate governance rather than tax – the tax market points are effectively being used as part of BEIS’s assessment of the state of the audit market. In reality, note the CIOT/ATT, the position in the tax market is very different.
The CIOT/ATT consider that tax should not be included within the remit of the Audit, Reporting and Governance Authority (ARGA) (which will be the successor body to the Financial Reporting Council). Problems within the tax advice market are distinct from those noted as affecting the audit market and are already being addressed by HMRC in the consultation ‘raising standards in the tax advice market’ and also the consultation on whether professional indemnity insurance should be mandated for tax advisers.
