ABTA holds bonds for ABTA members for a period of 18 months and the bonds run to their full term even where an ABTA member has ceased to operate a business as a principal or agent. In order for the ABTA member to secure an early return of their bond accountants are required to confirm that there are no outstanding or future liabilities relating to the discontinued operations of the business.
It is likely that circumstances that give rise to the need to issue these reports will be extremely rare. Accountants need to be sure beyond reasonable doubt that there are no outstanding or future liabilities before signing this report. ICAEW cautions accountants to carefully consider before signing this report, as it is unlikely that work of sufficient depth and breadth to support a signed report will be possible.
In the past, ABTA has held that reporting accountants have a duty of care to ABTA when signing these reports. This could result in a potential liability if ABTA looks to the accountants to settle any claims. Reporting accountants may wish to discuss this with ABTA before signing any of the Audit001 series of reports.