The Financial Reporting Review Panel ('the Panel') this week published its activity report based on findings from the Panel's review of accounts in the year to 31 March 2009 in which:
- 326 sets of accounts were reviewed;
- 112 companies were approached by the Panel for further information or explanation;
- 68 companies have, to date, undertaken to reflect the Panel's comments in their future reporting; and
- 2 companies were the subject of a Panel press release having agreed to restate amounts reported in prior periods.
On the basis of the reviews conducted, the Panel has concluded that the current standard of corporate reporting in the UK is good and that there continues to be improvement in the general quality of IFRS and UK GAAP annual reports and accounts. AIM companies were required to use IFRS for the first time from December 2007 and they seemed to have benefitted from the experience of their listed peers in effecting their transition to IFRS. However, further quality improvements are necessary if they are to match that of their listed counterparts.
The Panel also noted that all companies need to continue to improve their disclosures of financial risks, judgements related to the application of accounting policies and sources of estimation uncertainty. Many markets remain highly volatile and this should be reflected in informative company specific disclosures about the effects of these uncertainties on the amounts reported in their accounts.