CRR Case Summaries and Entity-specific Press Notices
The FRC publishes, on a quarterly basis, summaries of its findings from recently closed reviews that resulted in a substantive question to a company (‘Case Summaries’). In addition, it publishes the names of companies whose reviews were closed in the previous quarter without the need for a substantive question. No Case Summary is prepared for such reviews.
Case Summaries, which are available for cases closed in the quarter ending March 2021 onwards, are included in the table below. As, currently, the FRC is subject to existing legal restrictions on disclosing confidential information received from a company, the Case Summaries can only be disclosed with the company's consent. Where consent has been withheld by the company, that fact is disclosed in the table.
From March 2018 until March 2021, the FRC published the names of companies whose reviews were closed in the previous quarter but did not prepare Case Summaries. However, on an exceptional basis, specific cases may be publicised through entity-specific Press Notices, which can also be found in the table below.
The FRC’s reviews are based solely on the company’s annual report and accounts (or interim reports) and do not benefit from detailed knowledge of the company’s business or an understanding of the underlying transactions entered into. They are, however, conducted by staff of the FRC who have an understanding of the relevant legal and accounting framework. The FRC’s correspondence with the company provides no assurance that the annual report and accounts (or interim reports) are correct in all material respects; the FRC’s role is not to verify the information provided but to consider compliance with reporting requirements. The FRC’s correspondence is written on the basis that the FRC (which includes the FRC’s officers, employees and agents) accepts no liability for reliance on its letters or Case Summaries by the company or any third party, including but not limited to investors and shareholders.
Key
- Only a certain number of CRR’s reviews result in substantive questioning of the Board. Matters raised may cover questions of recognition, measurement and/or disclosure.
- CRR’s routine reviews of companies’ annual reports and accounts generally cover all parts over which the FRC has statutory powers (that is, strategic reports, directors’ reports and financial statements). Similarly, CRR’s routine reviews of companies’ interim reports will generally cover all information in that document. Limited scope reviews arise for a number of reasons, including those conducted when a company’s annual report and accounts or interim report are selected for thematic review or reviews that have been prompted by a complaint. In accordance with the FRC's Operating Procedures, for Corporate Reporting Review, CRR does not identify those companies whose reviews were prompted by a complaint.
- The FRC may ask a company to refer to its exchanges with CRR when the company makes a change to a significant aspect of its annual report and accounts or interim report in response to a review.
- Case closed after 1 January 2021 but performed under operating procedures that did not allow for the publication of Case Summaries.
- From the quarter ended June 2023, the FRC started identifying the auditor of the annual report and accounts, or the audit firm that issued a review report on the interim report, that was the subject of the CRR review. This information was also back-dated for closed cases publicised from the quarter ended September 2022. Cases marked N/A relate to those published prior to September 2022 or interim reviews that did not have a review opinion.’
Case Summaries
CRR Case Summaries and Entity-specific Press Notices (Excel version)
| Entity | Airtel Africa plc |
|---|---|
| Balance Sheet Date | 30 September 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | Deloitte LLP |
| Case Summary / Press Notice | N/A |
| Entity | Aldi Stores Limited |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Limited |
| Quarter Published | March 2024 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice |
This company was selected as part of our thematic review of the UK's largest private companies and, as such, only disclosures included in the scope of the thematic were reviewed. Consolidated statement of cash flows We asked the company for additional information in relation to the classification of its cash pooling arrangements in the statement of cash flows. We closed our enquiry after the company explained the arrangements and agreed to consider including additional disclosures in its 2023 annual report and accounts. Turnover analysis We enquired about the reason for the company’s non-disclosure of its turnover analysis and accepted its response. |
| Entity | Apax Global Alpha Limited |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | KPMG Channel Islands Limited |
| Case Summary / Press Notice |
Alternative Performance Measures (APMs) We asked the company to explain the basis on which it determined that the Strategic Report contained a fair review of its business, including a balanced and comprehensive analysis of its development and performance during the financial year and its position at the end of that year, as required by the Disclosure Guidance and Transparency Rules (DTR). We asked for this explanation as we were unable to locate any discussion of IFRS measures in the Strategic Report. The company explained that, as a closed-end investment company, its users need information in addition to that provided by IFRS measures, and it views Net Asset Value (NAV) and total NAV Return as the key metrics. The company also explained that there was no difference between NAV and adjusted NAV in the current reporting period. We accepted the company’s response; however, we noted our expectation that, should NAV be different to adjusted NAV in future reporting periods, we would expect the Strategic Report to include commentary to explain the difference. Valuation of private equity investments We asked the company for further information on the valuation of private equity investments and the basis on which the company satisfied itself that the disclosures on the fair value of those investments met the disclosure objective of IFRS 13 ‘Fair Value Measurement’. The company provided a satisfactory response to our questions. |
| Entity | Ashtead Technology Holdings plc |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | BDO LLP |
| Case Summary / Press Notice |
Classification of cashflows from sales and purchases of property, plant and equipment (PP&E) We queried the classification of cashflows from sales and purchases of PP&E as investing activities, given the company appeared to hold assets for rental and subsequent sale to customers. The company clarified they did not actively seek to sell items of PP&E to third parties and such transactions primarily arose when a customer lost or damaged leased assets beyond repair. The company agreed to provide additional disclosure to explain the classification in their 2023 financial statements. Presentation and analysis of income taxes We asked for further details of significant items within the company’s deferred taxation charge and of the circumstances that gave rise to the recognition of a deferred taxation liability in the US in 2022. The company provided satisfactory responses and agreed to include a reconciliation of the deferred tax included in the balance sheet and income statement for each type of temporary difference in a tabular format in the 2023 financial statements. |
| Entity | Aston Martin Lagonda Global Holdings plc (3) |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | Ernst & Young LLP |
| Case Summary / Press Notice |
Parent company investments We asked the company to explain how the Directors had satisfied themselves that there was no impairment to recognise in respect of the parent Company’s investments in subsidiaries and the amounts due from group undertakings. As a result of our enquiry, the Company agreed to restate the comparative amounts in its next annual report to record an impairment in respect of the parent Company’s investment in subsidiaries, remove an expected credit loss charge in respect of amounts due from subsidiaries, and reclassify loans to subsidiaries from ‘Debtors: amounts falling due within one year’ to Debtors: amounts falling due in more than one year’. The company agreed to disclose the fact that these matters had come to its attention because of our enquiry. Provisions and contingent liabilities We asked the Company to explain how they had complied with the requirements of IAS 37, ‘Provisions, Contingent Liabilities and Contingent Assets’ in respect of claims filed against the Company by Nebula Project AG. The Company provided a satisfactory response. |
| Entity | Aviva plc |
| Balance Sheet Date | 30 June 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | March 2024 |
| Auditor (5) | PricewaterhouseCoopers LLP |
| Case Summary / Press Notice | N/A |
| Entity | Babcock International Group PLC |
| Balance Sheet Date | 31 March 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | Deloitte LLP |
| Case Summary / Press Notice | N/A |
| Entity | Baillie Gifford China Growth Trust plc |
| Balance Sheet Date | 31 January 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | Ernst & Young LLP |
| Case Summary / Press Notice | N/A |
| Entity | Balanced Commercial Property Trust Limited |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | PricewaterhouseCoopers CI LLP |
| Case Summary / Press Notice | N/A |
| Entity | Barclays PLC |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | March 2024 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice | N/A |
| Entity | Beazley plc |
| Balance Sheet Date | 30 June 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | March 2024 |
| Auditor (5) | Ernst & Young LLP |
| Case Summary / Press Notice | N/A |
| Entity | British American Tobacco p.l.c. |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice |
The value in use calculation for the Reynolds American cash-generating unit was based on probability weighted scenarios to derive a risk-adjusted cash flow forecast. We asked the company to quantify the weightings applied to the scenarios modelled, to confirm whether they were key assumptions, and whether significant judgement was involved with their determination. The company provided the information requested and confirmed that the weightings were neither key assumptions nor involved significant judgement. We asked the company to explain the significant decrease in the impairment provision associated with the Russia and Belarus operations during the year. The company satisfactorily explained the reasons for the decrease, and also clarified that the Belarusian assets and liabilities were not material. We asked the company to provide some additional information to support the net, rather than gross, presentation of cash flows associated with derivatives in the cash flow statement. The company satisfactorily explained the basis for the net presentation and clarified that cash flows associated with derivatives not settling on the same day were assessed as not material. |
| Entity | Capital Gearing Trust P.l.c |
| Balance Sheet Date | 31 March 2023 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | BDO LLP |
| Case Summary / Press Notice | N/A |
| Entity | Centrica plc |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2024 |
| Auditor (5) | Deloitte LLP |
| Case Summary / Press Notice | N/A |
| Entity | Chanel Limited |
| Balance Sheet Date | 31 December 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | March 2024 |
| Auditor (5) | Ernst & Young LLP |
| Case Summary / Press Notice | N/A |