Corporate reporting guidance from FRC is timely and important
James Roberts (pictured), Audit partner at BDO, welcomes The Financial Reporting Council’s (FRC) announcement of a programme of work to promote clear and concise reporting from which investors can draw conclusions about a company’s performance, position and prospects…
As a first step, the FRC has published Guidance on the Strategic Report; the new reporting requirement designed to give investors an insight into the way the business is run and its strategic direction.
Corporate reporting should be the currency of trust in capital markets but this trust is being steadily eroded. That’s why this guidance from the FRC is timely and important.
In Genesis, God created heaven and earth in less than 1,000 words. So why should the length of just the corporate governance section in one company’s annual report be 14,000 words? Companies need to demonstrate risk and opportunity in a clear, simple and concise manner. Risk will always be present, but good reporting must reduce it, and be of real value to investors and also to companies competing to attract funds.