More to be done on corporate reporting, says Financial Reporting Council

The Financial reporting Council’s (FRC) annual review showed small improvements in certain areas but an overall need for more to be done

The FRC wants large listed companies to provide more specific data, rather than the “boiler-plate” text that is still lingering.

Paul George, executive director for corporate governance at the FRC, noted that overall reporting was good but highlighted the need to beware of complacency.

There was a slight improvement in narrative reporting, with increased focus on risk management at board level since the introduction of viability statements, and improvements in strategic reports.

Despite improvements, such as those recorded by companies regarding performance measures, there were still questions raised over clarity and specificity, an area the authority frequently challenged.

The review considered that despite the progress, there was no remarkable change regarding strategic reports since the previous year.

“Many of the findings in the Financial Reporting Council's 2016/17 review of corporate reporting published today echo with our views,” said Mala Shah Coulon, associate partner at EY UK’s corporate governance team.

“In our view, focusing on actions and outcomes rather than providing information on processes and policies is one way companies can balance calls for increased disclosures while at same time keeping their annual reports clear and concise.

She encouraged companies to consider materiality and specificity when making disclosures.

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