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 | Vistry Group Plc |
|---|---|
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | March 2023 |
| Auditor (5) | PricewaterhouseCoopers LLP |
| Case Summary / Press Notice |
Land options We asked the company to explain its accounting policy in respect of land options, as there was an apparent inconsistency in the subsequent accounting treatment between the options separately purchased and those obtained as part of an acquisition. The company provided adequate explanation and agreed to consider the materiality of disclosing land options separately and to clarify the accounting policy in respect of these assets in its future annual report and accounts. Remuneration of key management personnel We noted that the amount of key management personnel’s wages and salaries was significantly less than the remuneration of directors disclosed in the Directors’ Remuneration Report. The company acknowledged that certain elements of remuneration within the key management personnel note had been omitted and undertook to restate the comparatives and amend its definition of key management personnel to also include non-executive directors. Parent company pension arrangements We asked the company whether it was the sponsoring employer for the group’s defined benefit pension schemes. The company clarified that the sponsoring entity was a subsidiary and agreed to amend the narrative in the notes to the financial statements to reflect this. |
| Entity | WD FF Limited |
| Balance Sheet Date | 25 March 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2023 |
| Auditor (5) | Grant Thornton UK LLP |
| Case Summary / Press Notice | N/A |
| Entity | WH Smith PLC |
| Balance Sheet Date | 31 August 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2023 |
| Auditor (5) | PricewaterhouseCoopers LLP |
| Case Summary / Press Notice | N/A |
| Entity | Wincanton plc |
| Balance Sheet Date | 31 March 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | March 2023 |
| Auditor (5) | BDO LLP |
| Case Summary / Press Notice | N/A |
| Entity | Wise plc |
| Balance Sheet Date | 31 March 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | March 2023 |
| Auditor (5) | PricewaterhouseCoopers LLP |
| Case Summary / Press Notice | N/A |
| Entity | 3i Group plc |
| Balance Sheet Date | 31 March 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Full |
| Quarter Published | December 2022 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice | N/A |
| Entity | Adriatic Metals PLC |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | BDO LLP |
| Case Summary / Press Notice | N/A |
| Entity | Airtel Africa plc |
| Balance Sheet Date | 31 March 2022 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | Deloitte LLP |
| Case Summary / Press Notice | N/A |
| Entity | Amerisur Resources Limited |
| Balance Sheet Date | 31 December 2019 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | N/A |
| Case Summary / Press Notice |
We asked the company to explain the omission of consolidated financial statements from its annual report and accounts for the year to 31 December 2019. The company acknowledged that the annual report and accounts did not comply with section 399(2) Companies Act 2006, explaining that, following its acquisition in January 2020, the directors concluded that it was not possible to produce consolidated financial statements and that the information would be of limited value to the new parent entity. Taking into account subsequent information provided by the company about its intended liquidation, we did not consider it proportionate to pursue the matter.
|
| Entity | Ascential plc |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | December 2022 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice |
Assessment of control and significant influence We asked for information about the judgements made in assessing whether the Group has control or significant influence over an investment accounted for as an associate. Control While it was unclear from the company’s response why the potential voting rights arising from a Buy-Out Option were not considered substantive, the option expired, unexercised, subsequent to the balance sheet date. Consequently, we did not consider it proportionate to pursue this further. Significant influence We were not fully persuaded by the company’s arguments that it has significant influence, as defined by IAS 28, over the investment. The company subsequently clarified that the effect on its 2021 financial statements would not have been material had the company concluded that it did not have significant influence over the investment during the year. On the basis of that explanation, we closed our enquiry. Disclosure of judgements The company enhanced its disclosures about the judgements made in its subsequent Half Year Results and also agreed to disclose further information about the significant judgements made in determining that a company has significant influence, where required by IFRS 12 ‘Disclosure of Interests in Other Entities’, in its next annual report and accounts. |
| Entity | Balfour Beatty plc |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice | N/A |
| Entity | Bellevue Healthcare Trust plc |
| Balance Sheet Date | 30 November 2021 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | Ernst & Young LLP |
| Case Summary / Press Notice | N/A |
| Entity | BP p.l.c |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | Yes |
| Scope of Review (2) | Full |
| Quarter Published | December 2022 |
| Auditor (5) | Deloitte LLP |
| Case Summary / Press Notice |
Segmental reporting We asked the company for information about its gas & low carbon energy segment. We were unable to determine from the company’s disclosures whether this is considered to be a single operating segment, or whether its gas and low carbon businesses are separate operating segments but met the criteria to be aggregated and reported as a single segment under IFRS 8, ‘Operating Segments’. The company confirmed that gas & low carbon energy had been determined to be a single operating segment and, therefore, the aggregation criteria do not apply. The company explained that these businesses are managed as a single segment and that key decisions are made for the segment as a whole. The company agreed to clarify this in future strategic reports and to disclose whether any segments have been aggregated. We observed that investors may value additional information about the financial performance of low carbon energy and other transition growth businesses in order to better understand progress against the disclosed strategy. The company agreed to consider providing such disclosures, to the extent material and relevant to future reporting. |
| Entity | British American Tobacco p.l.c. |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | KPMG LLP |
| Case Summary / Press Notice | N/A |
| Entity | Bunzl plc |
| Balance Sheet Date | 31 December 2021 |
| Exchange of Substantive Letters (1) | No |
| Scope of Review (2) | Limited |
| Quarter Published | December 2022 |
| Auditor (5) | PricewaterhouseCoopers LLP |
| Case Summary / Press Notice | N/A |