We comment on the FRC's Conduct Committee operating procedures consultation

  • Consulation paper Revised operating procedures for reviewing corp rep Image

16 Jun, 2014

We have published our comment letter on the UK Financial Reporting Council's proposals to amend the operating procedures of its Conduct Committee with respect to reviewing corporate reporting. We believe that in the proposals are an appropriate response to the challenges faced by the financial reporting community in restoring trust in corporate reporting following the financial crisis.

We note that the FRC's proposals largely seek to codify changes to the Conduct Committee's operating procedures that have already evolved organically.  The two main proposals are that:

  • Rather than issuing a press notice when a company has made a significant correction or improvement to a report, the Committee will request that the company refers to the Committee's intervention in the report in which the change is made (a "Committee reference").
  • Each year, the Committee will identify in its Annual Report those companies which have published a Committee reference in the year under review.

Although these are not currently reflected in its procedures, use has been made of Committee references rather than press notices for several years.  Also, in its 2013 Annual Report the names of the companies that had published Committee references in the year under review, although we note that companies were given the chance to object to this and one did ask for their name to be withheld.

Our full response to this consultation can be downloaded from the publications page.

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