ICAS issues an additional report on improving reporting
The Institute of Chartered Accountants in Scotland (ICAS) has completed further work on its project to improve the quality and usability of financial reports, and issued a new publication entitled 'Making Corporate Reports Relevant'.
The new report provides a summary of feedback on an earlier report, Making Corporate Reports Readable, which was published by ICAS in 2010. The 2010 report proposed that entities produce a 'short form' reporting which would describe the business model; the company’s strategy; its key risks and how those risks are mitigated; and includes summary financial information, Key Performance Indicators (KPIs) and the significant judgements made by management in preparing the report – while remaining consistent with the full financial statements.
The new report notes that there is "general acceptance that the current state of corporate reporting is unacceptable and there is a definite momentum for change".
However, the report also acknowledges the challenges of IFRSs:
One of the strongest messages... was that there is a general dissatisfaction with the financial reporting framework of International Financial Reporting Standards (IFRS). The general consensus of opinion was that corporate reporting could not be fundamentally reformed without considering the issues associated with IFRS and in particular the volumes of disclosures.
The updated report also acknowledges the work of other organisations, such as the International Integrated Reporting Council (IIRC), and the need to take account of the developments in technology such as XBRL.
Click for access to the full report (link to ICAS website).