The Law Society and RICS have backed the consultation bill on limited liability partnerships while calling for a number of changes.
The RICS is concerned that the government may not find time to introduce the legislation and has warned that unless ministers act, surveying firms could move to offshore havens that already offer LLP status.
The Law Society also addressed the trade and industry select committee yesterday. It said that LLPs would not only protect the personal assets of members if the partnership were declared insolvent, but would also attract partners who might not have joined a firm with unlimited liability. The latter consideration gives partnerships “a more level playing field” when competing with the corporate sector to recruit.
But the two bodies disagree on financial disclosure and whether restricting eligibility to regulated firms would convey an unfair commercial advantage.
The RICS now accepts that LLPs should disclose financial information “equivalent to, but no greater than that provided by companies”. But the institution warned that the cost of transferring to LPP might be too much for those firms that have fewer than five partners.
But the Law Society warned that accounting standards applicable to companies would not automatically work for LLPs. It argues that it would be unfair if LLPs had to draw up two sets of accounts, so it has called on the ASB to see which existing standards (with possible modifications) should apply to LLPs.
PLS News 02/12/98