News - 2014

05 November 2014 - Lab reminders for the 2014 reporting season

With the 2014 reporting cycle fast approaching the FRC’s Financial Reporting Lab has today published its Lab reminders for the 2014 reporting season. The reminder summarises the Lab’s published reports and highlights areas where relatively simple changes could improve corporate reporting, enhancing the usefulness of reports for investors.

The summary brings together key finding from the reports:

  • Towards Clear & Concise Reporting

  • Accounting policies and integration of related financial information

  • Reporting of Audit Committees

  • Presentation of market risk disclosures

  • Debt terms and maturity tables

  • Net debt reconciliations

  • Operating and investing cash flows


A copy of the summary can be found here.

 

16 September 2014 - Lab publishes project slides

The Financial Reporting Council’s (FRC) Financial Reporting Lab (the Lab) has published slide packs which summarise the key findings from their two most recent reports:
Towards Clear & Concise Reporting
This examines progress made by companies towards producing relevant and succinct annual reports and accounts, and provides ideas on how companies can make further progress. The slides provide an overview of the key findings from the report. The full report has additional examples from BP and Prudential as to how they made their reports clearer and more concise as well as providing some aids on cross-referencing, characteristics of good reporting and the regulatory context.

Accounting policies and integration of related financial information
This report provides valuable insight for companies on what investors want from accounting policy disclosures and where they should appear in financial statements. The slides highlight key views of investors. The full report provides examples of practice from participant companies including Schroders and Vodafone.

The Lab has developed the slide packs to assist organisations in the preparation of their own materials in relation to Lab project report findings.

Slides and the full reports are available here.

12 August 2014 – FRC publishes Lab insight report Towards Clear & Concise Reporting

The Financial Reporting Council’s (FRC) Financial Reporting Lab (Lab) has published an insight report ‘Towards Clear & Concise Reporting’. This examines progress made by companies towards producing relevant and succinct annual reports and accounts, and provides ideas on how companies can make further progress.

Based on a review of the most recent round of annual reports published by FTSE 350 companies, the Lab encourages companies to think about:

  • the communication channels used and how to match information to users’ needs;

  • how to focus content on what is most important to investors;

  • removing immaterial disclosures;

  • using cross-referencing and layout to improve clarity; and

  • planning ahead.

The report also gives practical insight on the process of change and how BP and Prudential have managed their own process of change.

Sue Harding, Director of the Financial Reporting Lab, said: “The FRC’s Clear & Concise reporting work seeks to promote reporting from which investors can, with justifiable confidence, draw conclusions about a company’s performance, position and prospects. Now is an ideal time for companies to think about how to take steps to make their next annual reports clearer and more concise.

This Lab insight report provides examples of how companies are actively working to improve their annual reports and accounts and identifies some questions companies may wish to address. By sharing observations on steps already being taken by some companies, we aim to provide a useful source of ideas to act as an impetus for further progress towards clear and concise reporting.”

A copy of the report can be downloaded here.

 

25 July 2014 - FRC publishes Lab report on accounting policies and integration of related financial information

The Financial Reporting Council’s (FRC) Financial Reporting Lab has published a report on ‘Accounting policies and integration of related financial information’, which provides valuable insight for companies on what investors want from accounting policy disclosures and where they should appear in financial statements.

16 companies, 19 institutional investor and analyst organisations, and over 200 retail shareholders took part in the Lab project. This report is a further contribution to the FRC’s programme of work to promote Clear & Concise reporting from which investors can, with justifiable confidence draw conclusions about a company’s performance, position and prospects.

The report shows that for significant accounting policies, investors want improved disclosure that avoids boilerplate text by being specific to the company and providing sufficient detail to understand how the company accounts for its transactions. They are also keen to gain a better understanding of the impact of judgement and estimation on the reporting of a company’s results and financial position. Their suggestions support Clear & Concise reporting.

The Lab report includes examples of current good practice as well as highlighting how disclosure could be modified to provide the most value to investors in the future.

A copy of the report can be downloaded here.

 

11 July 2014 - Financial Reporting Lab Stakeholder Survey (now closed)

The Financial Reporting Lab survey is now closed, but please do share any comments for the Lab by emailing FinancialReportingLab@frc.org.uk

 

17 June 2014 – Financial Reporting Lab Stakeholder Survey.   Closing soon!

In early May the FRC’s Financial Reporting Lab (the Lab) launched a survey seeking feedback from all those involved in reporting.  It will take no more than a few minutes, and will provide us with valuable information to guide future projects and activities of the Lab.

The survey closes on Monday 30 June so if you have not yet completed the survey then there is still time.
The survey is focused on what the priorities of the Lab should be going forward and providing feedback on its activities to date.

Answering these questions should not take more than a few minutes, and will provide us with valuable information to guide future projects and activities of the Lab.
 
Please click on the following link to answer the questions online: https://www.surveymonkey.com/s/FPGSNZ2    
 
If you have already completed the survey we thank you for your time.

09 May 2014 – Financial Reporting Lab Stakeholder Survey – We want your views!

The FRC’s Financial Reporting Lab (the Lab) was launched to facilitate improvements in the effectiveness of corporate reporting in the UK. So far with the help of companies and investors, the Lab has published seven reports which have covered a range of governance and financial reporting topics.

To ensure that the Lab’s work remains focused on issues important to the reporting community, feedback is requested from all those involved in reporting, including companies and their advisors, auditors, representative/professional bodies and investors (institutional and individual) and analysts, via a short survey. The survey is focused on what the priorities of the Lab should be going forward and providing feedback on its activities to date. Answering these questions should not take more than a few minutes, and will provide us with valuable information to guide future projects and activities of the Lab.

Please click on the following link to answer the questions online: https://www.surveymonkey.com/s/FPGSNZ2    
 
We would be most grateful to you for taking the time to complete the survey, and ask that you do so by Monday 9th of June. Please also feel free to forward this request to anyone else you feel may have an interest in providing views.

 

30 April 2014 -  Corporate Reporting in a Digital World

The Financial Reporting Lab (the Lab) announces a project to investigate how companies are, and might in the future, use digital media in their corporate reporting to improve investors’ access to information. The Lab will initially review how companies currently use a wide range of digital media, including websites, videos, apps, social media platforms and blogs in their external communications to investors, and how investors use what is produced.

This project is the first part of a series of three projects on Corporate Reporting in a Digital World. Over the next 18 months the Lab plans to investigate:

  • Digital Present:  The current state of corporate reporting through digital media;

  • Digital Challenges:  Barriers to the use of digital media in reporting;  and

  • Digital Future:  How companies might make the most of technological opportunities.

This project doesn’t signal the end of reporting by companies on paper, but rather is designed to look forward to the opportunity digital methods may offer.  Many companies have already begun to innovate in the area of digital reporting, and the Lab can uniquely add to the debate by helping companies and investors explore what is best in current practice as well as looking towards a vision of what reporting might look like in the future to better meet their needs.

The Lab is inviting listed companies, investors and analysts to express their interest in taking part in the project. Those interested in participating can contact the Lab via email at: FinancialReportingLab@frc.org.uk, or by telephone on 020 7492 2458 by 30 May.

Full details of the call for participants can be found here: Call for participants - Corporate Reporting in a Digital World

 

31 March 2014 -  New Financial Reporting Lab project on Disclosure of Dividend Policy and Capacity

The FRC invites listed companies and investors/analysts to participate in a project on the effective communication and disclosure of dividend policy (sometimes referred to as dividend strategy) and capacity.

Lab Project: Disclosure of Dividend Policy and Capacity
 
This project will assist companies in better understanding investor concerns on current practices. It will also provide an opportunity for companies to enhance their reporting and provide information which investors indicate is important to their assessment of an investment case.

It is anticipated that the project will explore the communication by companies at the group/holding company level, in respect of:

  • any significant constraints on dividends, such as structural, legal or other considerations that could prove limiting to the conversion of profits to a flow of cash dividends to shareholders; and

  • the nature of the company’s dividend policy and how the policy relates to its strategic objectives and the company’s capacity to pay dividends.

Companies and investors/analysts are asked to indicate their interest in participating in this project over the course of April.  This will allow the Lab to obtain input from the investment community over the following months, with the aim of publishing the Lab’s report on this topic in the second half of the year.
 
Companies and investors/analysts interested in discussing participation in this project should contact the Lab team by email at: FinancialReportingLab@frc.org.uk or contact Sue Harding by telephone on 020 7492 2442 or Marian Williams on 020 7492 2428.

 

31 January 2014 - Reminders for the reporting season

Since inception, the FRC’s Financial Reporting Lab (the Lab) has published seven reports on a variety of governance and financial reporting topics.  By highlighting areas where simple changes could improve corporate reporting, the Lab aims to enhance the usefulness of company reports to investors.

With many companies now engaged in the reporting cycle, we thought it would be helpful to highlight some of the key topics from our reports to date.  The summary brings together key finding from reports on:

  • Audit Committee reporting

  • Remuneration reporting

  • Presentation of market risk disclosures

  • Debt terms and maturity tables

  • Net debt reconciliations

  • Operating cash flows

A copy of the summary can be found here.

Share