Duty of Care Auditor in UK Law

Leading Cases
  • Man Nutzfahrzeuge AG and another v Freightliner Ltd and Others
    • Queen's Bench Division (Commercial Court)
    • 28 Oct 2005

    One can see here a reflection of the principles governing the measure of damages recoverable in cases of this kind.

  • Caparo Industries Plc v Dickman
    • Court of Appeal (Civil Division)
    • 29 Jul 1988

    He naturally, and rightly, regards the company as his client. It is attached to and forms part of the company's accounts (ss.238 (3) 239). A copy of the company's accounts (including the auditor's report) must be sent to every member (s.240). Any member of the company, even if not entitled to have a copy of the accounts sent to him, is entitled to be furnished with a copy of the company's last accounts on demand and without charge (s.246).

  • Caparo Industries Plc v Dickman
    • House of Lords
    • 08 Feb 1990

    What emerges is that, in addition to the foreseeability of damage, necessary ingredients in any situation giving rise to a duty of care are that there should exist between the party owing the duty and the party to whom it is owed a relationship characterised by the law as one of "proximity" or "neighbourhood" and that the situation should be one in which the court considers it fair, just and reasonable that the law should impose a duty of a given scope upon the one party for the benefit of the other.

    It is never sufficient to ask simply whether A owes B a duty of care. It is always necessary to determine the scope of the duty by reference to the kind of damage from which A must take care to save B harmless.

    It has to be borne in mind that the duty of care is inseparable from the damage which the plaintiff claims to have suffered from its breach. It is not a duty to take care in the abstract but a duty to avoid causing to the particular plaintiff damage of the particular kind which he has in fact sustained.

    If the statutory accounts are prepared and distributed for certain limited purposes, can there nevertheless be imposed upon auditors an additional common law duty to individual shareholders who choose to use them for another purpose without the prior knowledge of the auditors?

  • Galoo Ltd and Others v Bright Grahame Murray
    • Court of Appeal (Civil Division)
    • 21 Dic 1994

    A mere foreseeability that a potential bidder may rely on the audited accounts does not impose on the auditor a duty of care to the bidder, but if the auditor is expressly made aware that a particular identified bidder will rely on the audited accounts or other statements approved by the auditor, and intends that the bidder should so rely, the auditor will be under a duty of care to the bidder for the breach of which he may be liable.

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Legislation
  • Charities Act 2011
    • UK Non-devolved
    • 1 de Enero de 2011
    ...... given by the provision of accommodation or care to the persons mentioned in that paragraph, and. ...S-26 . General duty of principal regulator in relation to exempt ... eligible for appointment as a statutory auditor under Part 42 of the Companies Act 2006, or. . ......
  • Children's Hearings (Scotland) Act 2011
    • Scotland
    • 1 de Enero de 2011
    ...... S-17 . Duty as respects location of children's hearing 17 ... impaired, due to a lack of parental care,. . . (b) a schedule 1 offence has been ... copy of each statement of accounts to the Auditor General for Scotland for auditing. . (4) In ......
  • Freedom of Information Act 2000
    • UK Non-devolved
    • 1 de Enero de 2000
    ...... . (6) In this Act, the duty of a public authority to comply with. subsection ...other than the Auditor General for Wales, means— . (i) the public ...SCH-1.39 .   . 39. A primary care trust established under section 16A of the ......
  • The Public Contracts Regulations 2015
    • UK Non-devolved
    • 1 de Enero de 2015
    ...... no other means to ensure compliance with the duty to treat economic operators equally in accordance ... in relation to the procurement of health care services for the purposes of the NHS within the ... Scotland, Auditor-General . Scotland, Crown Office and Procurator ......
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Books & Journal Articles
  • Government rejects auditor liability cap.
    • Núm. 2004, Junio 2004
    • Financial Management (UK)
    • Regulations Update
    ...... bring forward amendments to the current bill to extend an auditor's duty of care." . Although many of the bill's provisions do address auditors' ......
  • Auditors' Liability for BCCI
    • Núm. 1-4, Enero 1994
    • Journal of Financial Crime
    • 306-315
    In an earlier contribution to this journal, the author sought to analyse the legal implications of the recent decision by the liquidators of the Bank of Commerce and Credit International (BCCI), To...
    ...... T o fulfi l th e statutor y duty , th e audito r mus t carr y ou t suc h investigation s a s ar e ... bu t wa s concerne d wit h th e exten t o f th e dut y o f care , i n th e absenc e o f a contractua l relationship , owe d b y ......
  • NEGLIGENCE LAW SUITS AND THE ACCOUNTANT
    • Núm. 1-4, Febrero 1993
    • Journal of Financial Regulation and Compliance
    • 403-407
    The paper argues that increasing litigation and expanding claims on both sides of the Atlantic are threatening the survival of even the largest accounting practices. In the UK, firms are so concern...
    ...... s o f practice , suc h a s antenata l care , o r ar e indulgin g i n defensiv e — ... , thi s mean s tha t a company' s auditor s ar e generall y brough t int o a cas e i ......
  • After Caparo— Liability in Business Transactions Revisited
    • Núm. 54-5, Septiembre 1991
    • The Modern Law Review
    ...... opinion, will be unable to sue the auditor for any 10sses.~ Given the range of ...duty of care to any bank which might rely ......
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Law Firm Commentaries
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