Companies will be held to account for any deaths resulting from their negligence if a draft Bill on corporate manslaughter becomes law. Individual directors will not be criminally liable, however.
Stressing the government' s strong commitment to legislating for victims of corporate killing, home secretary David Blunkett (pictured) has announced that there will be consultation with companies, business leaders and trade unions, and that further details of the Bill will be revealed in the autumn.
' There is great public concern at the criminal law' s lack of success in convicting companies of manslaughter where a death has occurred due to gross negligence by the organisation as a whole,' Blunkett said in a statement.
' The law needs to be clear and effective in order to secure public confidence and must bite properly on large corporations whose failure to set or maintain standards causes a death.'
The government initially published a consultation paper on reform to the law on involuntary manslaughter, including corporate manslaughter, three years ago, but has come under increased pressure of late, particularly from rail crash victims.
Although Ernst &Young in the US said it was alerted to accounting problems at HealthSouth in June last year, new evidence shows that the firm was aware of accounting problems at the clinic operator as far back as 1998.
Eleven former employees of HealthSouth now face charges in connection with an alleged $2.5bn (£1.4bn) fraud, which is thought to have begun in the 1980s, and could cause the collapse of the company.
E&Y confirmed it had been sent a memo by the House Energy and Commerce Committee in Washington in November 1998 alerting it to a host of alleged accounting problems, despite earlier saying it was only made aware of the problems in June 2002.
E&Y admitted it had sent a team to HealthSouth' s headquarters in Birmingham (Alabama) in 1998, following receipt of the memo, to investigate any wrongdoings. E&Y said after its 1998 investigation that it had ' determined the issues raised did not affect the presentation of HealthSouth' s financial statements.'
In a separate development, E&Y' s subsidiary, Executive Temporary Management (ETM) in the Netherlands, is set to be acquired by Resources Connection, an international professional services firm. The two firms have signed a non-binding memorandum of understanding, and if the deal goes ahead then Resources Connection intends to operate out of ETM' s six offices in the Netherlands. ETM would change its name to Resources Connection but its current management team would remain the same.
News Round-up
Tenon closes Birmingham office
Troubled consolidator Tenon has closed its West Midlands operation and its clients there have been absorbed by the company' s Nottingham practice. The closure is part of the rationalisation programme following the recent collapse in the consolidator' s share price.
PwC fined $1m for improper auditing
PricewaterhouseCoopers has agreed to settle US government allegations of improper auditing with a $1m (£600,000) payment but has not admitted any wrongdoing. The SEC said PwC signed off a SmarTalk TeleServices annual report in 1997 ' which contained materially false and misleading financial statements' involving a $25m reserve fund. This is the second time in less than a year that PwC has been fined for improper professional conduct to do with its audit work.
For love or money
Three quarters of accountants see money as more important than attractiveness and a sense of humour when dating, says recruitment firm Aijilon Finance.
Six in ten accountants approached admitted that the issue of money would be broached by the second meeting to find out if their bank balances were compatible.
Domain name renewal
Many websites will soon need their domain name registrations renewed, as a lot of sites set up during the dotcom boom come up for renewal. Many companies don' t realise this is something they will ever need to do, let alone how to go about it, as their sites were set up and registered by freelance web designers or contractors no longer involved with the company.
Stock option controversy
The International Accounting Standards Board' s most controversial project, Share-based Payment, has received a surprising amount of support following the board' s receipt of 236 comment letters on the exposure draft. The proposals, to force companies to deduct the cost of stock options, have been unpopular with companies, particularly in the US.
EU finance ministers approve pension law
EU finance ministers have agreed a new law to regulate and legislate for pan-European pensions. The commission has been pushing hard for a directive to encourage cross-border competition among pension funds and draw more workers into private schemes.
56% of job seekers lie on CVs
More than half of job seekers lie or mislead on their CVs, according to the Risk Advisory Group. The number of job applicants with CV discrepancies grew 15% year on year, from 54% in the last quarter of 2001 to 62% in the last quarter of 2002.
Flat tax rate wins over the Russians
A 13% flat rate has won unexpected support from most taxpayers in Russia. It is one of the few jurisdictions to offer a uniform rate and the tax authorities say it has improved compliance and revenue generation.
Bowman retains its independence
The Preston office of BDO Stoy Hayward has chosen to rebrand itself as Bowmans in a bid to retain its independence and keep its own client base, rather than join BDO as a unified national partnership. Bob Rawkins, managing partner of Bowmans, said: ' We' ve always been an independent firm but for the last six years we' ve been branded as part of BDO. They' ve decided to form a national partnership and invited us to join in. But we declined because we didn' t think it was in the best interests of our clients and our staff.'
Revenue tightens grip on NICs in shipping
The Inland Revenue has tightened its grip on national insurance contributions in the shipping industry. The aim is to prevent avoidance of employer' s NICs by shipping companies operating within UK territorial waters.
Britney hit by hedge
A hedge fund scandal in the British Virgin Islands has claimed Britney Spears and former Sotheby' s chairman Alfred Taubman as victims. They were among the investors who lost money when the $800m (£500m) fund collapsed.