The ‘big four’ accountancy firms are to lobby the government to further limit their liability as auditors in the event of corporate collapse, despite lawyers’ concerns that client companies would be ill-advised to agree to such a step.

A spokeswoman for the Institute of Chartered Accountants in England and Wales, which will lobby the government alongside Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers, said meetings with government officials are scheduled for this week.

Auditors want protection because they are open to being sued for all losses stemming from a company’s collapse. They want the government to force company shareholders to vote on how much liability should rest with the company, and how much should rest with the company’s auditors, via a vote on a standardised resolution at annual meetings (see Opinion).

The professional services global competitiveness group, which reported to chancellor Alistair Darling in mid-March, noted that law firms could not advise companies’ audit committees to enter into limited liability agreements with ­auditors, because this advice would not be in a company’s best interests. Company shareholders already have the power to limit auditors’ liability, but no blue-chip company has yet chosen to do so.