In Canada, the policy analysis at stage two of the Anns duty of care test has typically been limited to concerns about indeterminate liability. By way of contrast, the United Kingdom House of Lords has favoured a flexible approach in determining whether to impose a duty of care generally for negligence causing an economic loss. It allows for a consideration of a greater number of policy factors in cases involving auditors' liability to third parties.
In Customs Excise v. Barclays Bank,  UKHL 28 (“Barclays Bank”), the Customs and Excise Commissioners obtained a Mareva injunction freezing assets of two customers of Barclays Bank. When the Bank allowed funds to be withdrawn from the “frozen” bank accounts in error, the Commissioners sued. The House of Lords found that the Bank owed no duty of care to the Commissioners and, in doing so, endorsed three distinct tests.
Firstly, the Court considered whether the Bank had assumed responsibility to the Commissioners, a test derived from the leading negligent misrepresentation case of Hedley Byrne v Heller,  AC 465. Assumption of responsibility is assessed by an objective view of the facts and can easily be applied as a threshold test. If it is satisfied it is not necessary to apply any other test.
Secondly, the Court considered the three-fold test from Caparo Industries Plc v. Dickman,  2 AC 605: whether the loss to the plaintiff is a reasonably foreseeable consequence of the defendant's actions; whether sufficient proximity between the parties can be established; and whether it is fair, just, and reasonable to impose a duty of care when considering all of the circumstances. This allowed for a consideration of a variety of relevant policy considerations beyond indeterminate liability, including whether the plaintiff had alternative means to protect its interests, the availability of insurance to the parties, and whether the imposition of a duty of care would conflict with the defendants' other duties of care.
Thirdly, the Court considered an “incremental” test, which permits the law the flexibility to develop new categories of cases in which a duty of care will be found by analogy to cases in which a duty of care has previously been found.
It can be easily seen that this approach allows for the examination of numerous policy considerations other than indeterminate liability, such as the amount of money paid to auditors for the engagement versus the level of risk to which auditors are exposed, or the opportunity for others, such as shareholders, to oversee the work of the auditors or management to prevent the economic loss. This greater flexibility can be lauded for its ability to achieve fairness in a wide variety of circumstances; however, it is arguable that it does so at the expense of predictability.