Annual Review of Corporate Reporting
High quality and transparent reporting are fundamental to building trust and to the long-term success of UK companies and the wider economy.
In October 2017, we published our second Annual Review of Corporate Reporting (PDF).
The Annual Review of Corporate Reporting provides the FRC’s assessment of corporate reporting in the UK based on evidence gathered through the FRC’s monitoring of annual reports and accounts, outreach to a broad range of stakeholders and evidence gathered by other organisations.
The report highlights aspects of good practice, common areas for improvement and changing expectations of stakeholders. The FRC reviewed 203 annual and interim report and accounts in the year to April 2017. This year’s report highlights that:
- Corporate reporting, particularly by larger listed companies, is generally good, but not always as high as it should be, because detailed explanations and clarity could still be better and we still find too much generic rather than company specific reporting
- Pre-informing companies that we are to review specific aspects of the accounts has had a positive impact on quality, as many companies took the opportunity of reviewing the relevant disclosures and improving the quality of information provided.
- There have been further improvements in the strategic report this year, but it remains an area of frequent challenge in the course of our reviews, particularly where there is insufficient balance or where disclosures are not sufficiently specific or descriptions too vague.
- Expectations of corporate reporting are changing because of
- the implementation of three significant new accounting standards for Financial Instruments, Revenue from Contracts with Customer and Leases
- the EU Non-financial Reporting Directive
- a need to communicate how the company’s activities have contributed to the long-term success of the company and the interests of wider stakeholders
- a need to explain better how a company creates value and the extent to which that value is dependent on relationships with stakeholders.
Annual Review of Corporate Reporting 2016/17 (PDF)
Corporate Reporting Review Technical Findings 2016/17 (PDF)
Annual Review of Corporate Reporting 2015/16 (PDF)
Technical Findings of the Conduct Committee's Financial Reporting Review Panel 2015/16 (PDF)