Directors' Reports To Be Examined By Watchdog

Fri, 14 Sep 2007

Financial watchdog - The Financial Reporting and Review Panel - will now have the power to examine directors’ reports, it announced earlier this week.

It will also now examine whether the information in the business review is consistent with that disclosed in the company’s other announcements, as well as whether the business review is balanced in dealing ‘even-handedly’ with the positive and negative aspects of the development, performance and position of the business .

Around 300 accounts are selected by the panel to look at in detail each year, using tip-offs, media reports and other pro-active methods.

Bill Knight, the chairman of the panel, said: "We will not name companies but where there is a correction to accounts, we may publish a specific press notice ."

He said that action from the FRRP could be taken if instances of directors reporting inaccurate facts, failing to give a balanced assessment of the company’s position as well as a failure to comply with statutory requirements persist.

"But normally we don’t have to go to court because we solve issues by agreements and companies agree to make the changes," he added.
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