Reforms proposed by the Financial Reporting Council (FRC) could see auditors explain at more length in company accounts the issues they encountered when examining a firm’s finances.

The move comes after controversy over auditors’ decisions to sign off Royal Bank of Scotland and Halifax Bank of Scotland as going concerns months before they had to be bailed out by the taxpayer in 2008.

Mr Jubb told an FRC conference in London that the new reports must be as comprehensible to investors as to the Edinburgh-based funds giant that employs him.

Cupid, which has been targeted by hedge funds betting on a share price fall in recent months, issued a strongly-worded statement denying its methods are inappropriate or illegal and said it was taking legal advice against “misrepresentation and ill-informed speculation”.