The Financial Reporting Review Panel publishes revised operating procedures
News types: Consultation Announcement, Feedback Statement
Published: 14 May 2012
FRRP PN 135
The Financial Reporting Review Panel today published revised operating procedures (PDF) which incorporate changes on sharing information with the Audit Inspection Unit (AIU) and on the circumstances in which the Panel may make an announcement about a company’s report and accounts under review.
The Financial Reporting Review Panel today published revised operating procedures (PDF) which incorporate changes on sharing information with the Audit Inspection Unit (AIU) and on the circumstances in which the Panel may make an announcement about a company’s report and accounts under review.
The Panel works for as much mutual agreement as possible with companies in seeking improvements to their financial reporting. The amendments to the operating procedures do not affect this. The Panel is pleased that a more efficient approach will be possible through greater cooperation with the AIU. It is also pleased that the revised procedures will allow more transparency about the Panel’s work in specific circumstances.
Following public consultation and approval by the Department for Business (‘BIS’), the key changes, as proposed in the consultation document:
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enable the Panel to share voluntary information received by the Panel with the AIU:
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reserve the right of the Panel to make an announcement where, following its intervention, a company makes a significant change, whether corrective or clarificatory, to its financial or corporate reporting:
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enable the Panel to release its own press announcement if the fact of a Panel enquiry has become public other than as a result of a Panel press notice.
The feedback paper on the responses to the consultation paper provides further information on the practical considerations the Panel will apply.
The reforms of the FRC’s structure will necessitate amendments to operating procedures. These consequential amendments will be announced and published following approval by BIS.
The revised operating procedures apply to all cases where the Panel’s initial letter is sent to the company on or after 1 April 2012.
Notes to editors
The reforms of the FRC’s structure will necessitate amendments to operating procedures. These consequential amendments will be announced and published following approval by BIS.
The revised operating procedures apply to all cases where the Panel’s initial letter is sent to the company on or after 1 April 2012.
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 and directors’ reports of public and large private companies to see whether they comply with the requirements of the Companies Act 2006 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 Chairs are David Lindsell and Joanna Osborne. There are currently 31 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.