News February 2013 Financial Reporting Lab report on ‘Presentation of market risk disclosures’

Financial Reporting Lab report on ‘Presentation of market risk disclosures’

20 February 2013

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The Financial Reporting Council (FRC) has today issued a Financial Reporting Lab (Lab) project report on ‘Presentation of market risk disclosures’ (PDF). 

The Lab explored investors’ views on the benefits of presenting risk developments and actions taken in the reporting period separately from policy related information, shown in an appendix.  Views were also sought on aspects of the content of market risk disclosures; how they are used and best presented in practice.  Changes made by HSBC Holdings plc in its market risk disclosure were used as a basis for discussion.
Director of the Financial Reporting Lab, Sue Harding, said:

“The Lab is exploring various themes in reporting, including how to make relevant information more accessible, and the potential for reducing ‘clutter’.  Investors welcome a focus on reducing the volume and complexity of reporting, while still conveying information proportionate to the underlying exposures”.

The Lab encourages readers of its reports to comment on their content and presentation.  Any feedback will be taken into account in how the Lab approaches and reports on future projects. Please send any feedback to
Notes to editors:

  1. The FRC is responsible for promoting high quality corporate governance and reporting to foster investment.  We set the UK Corporate Governance and Stewardship Codes as well as UK standards for accounting, auditing and actuarial work.  We represent UK interests in international standard-setting.  We also monitor and take action to promote the quality of corporate reporting and auditing.  We operate independent disciplinary arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.
  2. The Financial Reporting Lab provides a unique environment where investors and companies can come together to develop pragmatic solutions to today’s reporting needs:
    • As a learning space, companies can use the Lab to test new and advanced reporting formats with investors, and investors can indicate areas where management can add greater value through the information they provide;
    • As a hub to support innovation in reporting, the Lab’s focus on gathering and sharing evidence from the market provides the broader corporate community with feedback from investors on the value that new reporting formats bring. More information about the Lab’s work can be found here.
  3. The report “Presentation of market risk disclosures” can be found here.
  4. The Lab’s previous reports on remuneration reporting, and debt and cash flow disclosure can be found here.
  5. The Lab has recently begun a project on audit committee reporting and welcomes further participants.  Details can be found here.