The FRC welcomes well informed complaints about the reports and accounts of entities that come within its remit for corporate reporting review.
Any review arising as a result of a complaint will be carried out in accordance with the Conduct Committee’s Operating Procedures for reviewing corporate reporting (‘Operating Procedures’).
Here are some answers to questions that are often asked by those who are considering making a complaint about an entity’s corporate reporting, or who have made a complaint and want to know about progress made. Details of the roles played by the Conduct Committee, the Corporate Reporting Review Committee (CRRC), FRRP members and staff in the corporate reporting review team (CRR) are set out in the section “How we review reports and accounts”. Further information about the Conduct Committee’s procedures and powers can be found in the operating procedures section.
Do I need to be a shareholder in a company in order to make a complaint?
How do I make a complaint about a set of accounts?
Can I speak to someone in the corporate reporting review team?
I have been told that my complaint is not being pursued. Why might that be?
What type of financial information is within the scope of the Conduct Committee scope?
What does the FRC do when it receives a complaint?
Will my identity be revealed to the company?
Can I speak to members of the corporate reporting review team, the Conduct Committee or the FRRP about the progress of my complaint?
Will I be informed of the outcome of my complaint?
What is a Review Group?
CRR says that it looks at hundreds of cases each year. Why are so few press notices issued about its findings?
What will happen to the company if my complaint is upheld?
Who are the members of the FRRP? Are they qualified?
No. Anyone can make a complaint against the report and accounts of a company or other entity within the Conduct Committee’s scope for corporate reporting.
We do act in response to anonymous complaints. Unless there is a public announcement at the closure of the case, however, this means that you may not know how the matter has been addressed.
First of all you should check that the complaint falls within the Conduct Committee’s scope as set out in the Operating Procedures. Details for contacting us in respect of corporate reporting review matters are set out on the contact page. It is important to set out your complaint clearly, referring, where possible, to a specific breach of accounting or reporting rules.
You can call to check if a matter is likely to fall within the Conduct Committee’s remit, but a written explanation of your concern is more likely to avoid misunderstanding.
We cannot give out information while a case is ongoing but will write to you when it is completed. If the review results in a public announcement, you will be sent a copy of the press notice.
There are a number of reasons why this might be the case. The entity that is the subject of the complaint may not fall within the Conduct Committee’s corporate reporting review remit or the complaint itself may not fall within the Conduct Committee’s scope as set out in its Operating Procedures. Where appropriate, if a case does not fall with the Conduct Committee’s remit, we may direct you to another authority.
What sort of issues do fall within the Conduct Committee’s corporate reporting review remit?
Possible breaches of accounting rules or failure to make disclosures required by the Companies Act or accounting standards.
The financial accounts, directors’ and strategic reports of UK public companies, large private companies, limited liability partnerships and certain overseas companies listed on the UK market are all within scope. This includes interim and annual accounts, but not press releases, trading statements or other financial reports that a company may publish from time to time.
The complaint is reviewed by staff in the corporate reporting review team. If there is, or may be, a question of whether a report complies with relevant accounting or reporting requirements, the CRR Director will write to the company Chairman seeking further information and explanations. In the course of our review, we may find other issues which we may wish to raise with the company.
We operate confidentially as set out in the Conduct Committee’s Operating Procedures. We do not normally disclose how a matter at issue came to our attention, nor do we reveal the identity of any complainant. Exceptions to this are where a complainant gives express permission to notify the company of the complaint or where the complainant has chosen to make the complaint public.
In addition, the FRC is a Prescribed Person under the Public Interest Disclosure Act 1998, which provides additional protection for complainants in some circumstances.
No. In order to maintain confidentiality we are not be able to discuss a case that is in progress, even with the complainant.
If we need further information from you, we will contact you to ask for further information or clarification. We prefer communication to be in writing in order to preserve a proper audit trail and to avoid misunderstandings.
As noted above, we will not discuss your complaint while the review is ongoing. We will, however, inform you of the outcome of our review to the extent possible, given our confidentiality obligations. If a press notice is issued, you will be sent a copy.
A Review Group is established when the CRRC decides that there may have been a potentially significant breach of accounting or reporting requirements that has not been able to be resolved through an interaction with CRR. This will usually be after an initial round of correspondence with a company, although, in exceptional circumstances, a Review Group may be established on initial review of the complaint.
The FRC has written to say that it is satisfied with the company's response to its enquiries and does not intend to take any further action. I am not happy about this as I still think the company's accounts are wrong. What can I do?
We will explain to you, as far as we are able given confidentiality restrictions, why we have decided to take no further action but will not enter into any further discussion about our decision. Your complaint will have been carefully considered. If we think that it might be appropriate for you to contact any other regulatory authority, we will tell you.
The FRC has a complaints procedure for anyone who comes into contact with a part of the FRC and who is unhappy or dissatisfied about the way that part has exercised or failed to exercise its functions. Full details of the procedure are set out under Procedure for complaints about the FRC on the website.
We select accounts for review in a number of ways (see "How we review reports and accounts”). In some cases, no question of potential substance arises from a review of the published accounts. In others, questions are resolved by explanation from the company. In a number of cases, the company agrees to improve its disclosures or accounting in the future. We only issue a press notice where a significant correction to published accounts is being made or where there is a case that we consider otherwise merits publicity.
The Conduct Committee’s powers are restricted to seeking the correction of defective accounts. In many cases, we accept corrective action by a company without the issue of a press notice. We may, however, issue a press notice setting out our conclusions on a case, the reasons for those conclusions, and the corrective action that has been agreed with the company. Where appropriate, we refer our findings to other relevant bodies, such as the FCA or a professional body.
A full list of current FRRP members can be found at FRRP Members
. FRRP members are qualified accountants or lawyers who specialise in company law and who hold, or have held, senior positions in their chosen field. They may be, or may have been, in practice, in the public sector or in industry, for example as a senior partner in a major accounting firm or as Finance Director of a FTSE 100 company. They are recruited by public advertisement. Other than the Chairman and Deputy Chairmen, who sit on the CRRC, they are unpaid. The underlying principle is that companies are reviewed by their peers. This ensures that our approach takes note of business considerations and is sensible and practical.