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FDs responsible for difficult statements, say experts

Published on 29 Apr 2010 under category: legal

Financial directors will have to make financial reports easier to understand, under new guidelines from the Financial Reporting Council (FRC).

The plans for the new document Cutting Clutter was reported in today's (April 29th) Accountancy Age.

The FRC has criticised the complexity of the language and the inclusion of irrelevant information in financial reports.

It also called for documents to be written primarily with investors in mind.

According to the magazine, company reports have been accused of being "poorly-structured", with important details often obscured by "trivial" disclosures.

However, financial directors should take responsibility for the documents rather than blaming any complexity on over-regulation, claims the magazine's editorial.

The council released a report last year to attempt to address the problem.



Louder Than Words highlighted how the recession was a big driver for streamlining reporting, as documents would be in danger of becoming more complex because of "uncoordinated responses to the crisis by regulators and standard setters".