ASB publishes Report on Cutting Clutter from Annual Reports
News types: Publications
Published: 6 April 2011
ASB PN 362
The Accounting Standards Board (ASB) of the FRC has today published a report – Cutting Clutter: Combating clutter in annual reports (PDF).
Clutter in annual reports is a problem, obscuring relevant information and making it harder for users to find the salient points about the performance of the business and its prospects for long-term success.
The report provides preparers of annual reports with practical aids for reducing clutter, giving ideas for how disclosures might look without the clutter, and factors to consider when planning the annual report process.
However, it’s not just preparers that can cut clutter. All of those involved in regulating, reviewing, preparing and using annual reports have to change their behaviours if we are to remove clutter and improve corporate reporting. The Government will be consulting further on the framework of narrative reporting. The FRC will coordinate its work with that. We also seek further debate on how materiality should be applied to financial statement disclosures.
Roger Marshall, Chairman of the ASB said:
The Accounting Standards Board (ASB) of the FRC has today published a report – Cutting Clutter: Combating clutter in annual reports (PDF).
Clutter in annual reports is a problem, obscuring relevant information and making it harder for users to find the salient points about the performance of the business and its prospects for long-term success.
The report provides preparers of annual reports with practical aids for reducing clutter, giving ideas for how disclosures might look without the clutter, and factors to consider when planning the annual report process.
However, it’s not just preparers that can cut clutter. All of those involved in regulating, reviewing, preparing and using annual reports have to change their behaviours if we are to remove clutter and improve corporate reporting. The Government will be consulting further on the framework of narrative reporting. The FRC will coordinate its work with that. We also seek further debate on how materiality should be applied to financial statement disclosures.
Roger Marshall, Chairman of the ASB said:
“Improving financial reporting is not just about issuing standards. We want to encourage a change in behaviours, where annual reports are clear and clutter-free, focusing on the disclosures that really aid an understanding of the business and its long-term prospects.”
The ASB hopes that the report will stimulate debate and action on this issue, and welcomes any comments by 30 September 2011. It plans to follow up on this work in the autumn.
Notes to Editors
- The Accounting Standards Board (ASB) is an operating body of the Financial Reporting Council (FRC), the UK’s independent regulator responsible for promoting high quality corporate governance and reporting to foster investment.
- The role of the ASB is to oversee the financial reporting requirements for UK entities. This is done by maintaining and improving UK Financial Reporting Standards (FRS) and influencing the development of international standards. The ASB achieves this by collaborating with accounting standard-setters from other countries and the International Accounting Standards Board (IASB).
- The ASB has ten Board members, of whom one (the Technical Director) is full-time, and the remainder, who have a variety of experiences as preparers, auditors and users of financial reports, are part-time.
- In following up on this work in the autumn the ASB plans to hold a meeting with interested parties, so that we can share views, discuss progress and showcase developing good practice. Please contact the ASB at [email protected] to confirm your interest.