Accounting - Auditor liability - up to a point.

(From Financial Director)

Byline: Peter Williams, a chartered accountant and freelance journalist.

The collapse of Andersen amidst the wreckage of Enron looks likely to bring about one result that accountancy firms - and the Big Four, in particular - have long awaited. After a 10-year campaign, a cap on auditor liability appears to be within reach. The UK government looks set to grant the firms their wish for one simple reason: it has finally cottoned on that the prospect of the Big Four turning into the Big Three is unthinkable.

So, ironically, those global behemoths, in the UK at least, have become a protected species.

A consequence of the introduction of an audit cap will be to shut out the realistic prospects of any break in the stranglehold that the top boys have over the quoted sector audit market.

The French, meanwhile, have reacted to Enron et al by boosting their long-established system of joint audits. A law in France is being introduced that enshrines the idea that one auditor should not dominate.

Although the idea of joint audit was floated here briefly last summer, the idea never took hold in Anglo-Saxon minds. But one Scottish-born financial director of a European 300 company has supported the idea of joint auditing. In a letter to the European Commission - seen by Financial Director - he wrote, "This choice of joint auditing seems to offer us the best guarantees, even more so in the current environment."