UK survey on narrative reporting

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20 Oct, 2010

Deloitte (United Kingdom) has released a new publication entitled Swimming in words, the latest annual survey of narrative reporting in the United Kingdom.

The survey analyses the narrative reporting of 130 listed companies, split into two categories, being investment trusts and other companies. It includes a review of:

  • how compliance with the disclosure requirements of the UK Companies Act 2006, the Listing Rules, the Disclosure and Transparency Rules and the Combined Code varied
  • the extent to which companies have adopted the UK Financial Reporting Council's revised guidance on going concern and liquidity
  • the use of the UK Accounting Standards Board's Reporting Statement: Operating and Financial Review.

The UK Department for Business, Innovation and Skills (BIS) issued a consultation paper on the future of narrative reporting in the United Kingdom in August 2010. The consultation period closed on 19 October 2010 and Deloitte has provided the results of the 2010 survey to BIS.

Main findings

  • the average length of the annual reports of UK listed companies is now over 100 pages for the first time (at 101 pages), more than double the average length of 44 pages recorded in 1996 when the surveys commenced
  • 93%, 94% and 90% of corporates provided the required information about the environment, employees, and social and community issues respectively. These percentages were a significant improvement on the 2009 equivalents of 87%, 89% and 70%
  • 90% of companies clearly identified key performance indicators, an increase from 84% in 2009. The average number of key performance indicators was seven
  • 4% of companies (2009: 7%) had received a modified audit report relating to going concern. While it is positive that this number has decreased, more companies named the state of the economy as a key business risk. Three quarters of companies did so in 2010 compared with 63% of companies in 2009
  • 35% (2009: 32%) of companies fully complied with the UK's Combined Code on Corporate Governance.

 

Click for Swimming in words - Surveying narrative reporting in annual reports (PDF 6,619k).

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