The Financial Reporting Review Panel's Annual Report
News types: Publications
Published: 28 September 2011
FRRP PN 132
The Financial Reporting Review Panel today published its annual report (PDF) based on findings from the Panel’s review of reports and accounts in the year to 31 March 2011 in which:
The Financial Reporting Review Panel today published its annual report (PDF) based on findings from the Panel’s review of reports and accounts in the year to 31 March 2011 in which:
- 301 sets of accounts were reviewed.
- 141 companies were approached by the Panel for further information or explanation.
- 4 companies were the subject of a Panel press release.
Narrative reporting was a key area of interest for the Panel during the year. Although some poor practice is still seen, the Panel was particularly pleased to note widespread improvement in the description of principal risks and uncertainties in the business review included within the directors’ report. Boards are also now more likely to describe the actions they are taking to mitigate the effects of risks and uncertainties which the Panel believes is required in order to satisfy the objectives of the review.
Commenting on the findings and recommendations, Bill Knight, Chairman of the Panel said:
“We are very pleased that descriptions of risks and uncertainties are improving. We are also looking to the balance and fairness of the business review – we applaud honest straightforward reporting which reflects the good and the less good aspects of the company’s performance.”
Notes to Editors
- The FRC is the UK’s independent regulator responsible for promoting high quality corporate governance and reporting to foster investment.
- The Role of the Panel is to examine the annual accounts of public and large private companies to see whether they comply with the requirements of the Companies Act 2006 (“the Act”) including applicable accounting standards. Following implementation of the Accounting Regulation (EC) No 1606/2002, this may mean compliance with UK or International Financial Reporting Standards.
- Where breaches of the Act are discovered the Panel seeks to take corrective action that is proportionate to the nature and effect of the defects, taking account of market and user needs. Where a company’s accounts or directors’ report are defective in a material respect the Panel will, wherever possible, try to secure their revision by voluntary means, but if this approach fails the Panel is empowered to make an application to the court under section 456 of the Act for an order for revision. To date no court applications have been made.
- The Chairman of the Panel is Bill Knight and the Deputy Chairmen, David Lindsell and Joanna Osborne. There are currently 35 other Panel members drawn from a broad spectrum of commerce and the professions. Individual cases are normally dealt with by specially constituted Groups of 5 or more members.