UK Moving to Sarbanes-Oxley Compliance
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Corporate governance in the UK is moving towards a Sarbanes-Oxley type regime, if a new white paper is any guide. The Company Law Reform White Paper has tougher penalties for accounting offences. Liability for breaches in legislation would be extended beyond directors and company secretaries. Deloitte in its latest Corporate Governance Update warns that the proposed changes are not as severes as Sarbanes-Oxley. Deloitte Audit Partner Martyn Jones said: “The Government has taken a lead from the US in deterring corporate misconduct although the measures outlined in the White Paper are not as severe as Sarbanes-Oxley legislation. “The consultation period is an opportunity for directors to shape a new framework of company law which is relevant to business needs. Giving input to the regulatory impact assessment on the costs and benefits of implementing the Government’s proposals will help ensure the new law supports the UK’s competitive position internationally.” Main points involve offences, penalties and who can be targetted. Liability stretches from directors and company secretaries to managers and delegated. New offences in accounting. Namely knowingly or recklessly delivering false or deceptive information to registrars. Up to 10 years for fraudulent trading. Conflcts of interest and directors duties are clarified. The role of Company Secretary will be removed from private companies.
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