Accountancy group KPMG has warned the government against any changes to the UK’s insolvency regime that could threaten market stability and business growth.

Responding to a government consultation of insolvency rules, which wraps today, KPMG welcome the chance to “evolve existing regulation”, but warned of unintended consequences in practice.

Simon Collins, UK chairman of KPMG, said: "The UK is viewed internationally as a stable place to do business, providing a positive environment for business growth but also having an established and predictable insolvency regime to deal with corporate distress and failure.

The World Bank’s insolvency regime index places the UK seventh in the world. Mr Collins said this put the UK in the “premier league” but also indicated that more could be done.

He pointed to the chance for creditors to become more involved in the process and having a better view of costs, as two examples of where rule changes could benefit insolvency practice.

Richard Fleming, also at KPMG, said previous rule changes needed time to bed in before further action was taken: "We have already seen steps to evolve and improve the UK insolvency regime.

“The Insolvency Service introduced measures in 2010, such as improving fee options, to tackle the 'red tape' challenge by streamlining how the insolvency profession engages with creditors. These changes are starting to take effect but we need to allow time for them to bed in.”