It is a question of hearing the essentials through the surrounding noise. It is being able to see the wood for the trees. This is the essential task of corporate reporting. People want to home in on exactly what is most important to them in their understanding of how a business is doing and how it has done it. It is about providing those who need it with the information they need. 

And put like that it is simple. Yet regulators, auditors, accountants, CFOs, standard-setters, investors and that elusive group, the informed public, have struggled with it and puzzled over it for generations. Yet here we are still wrestling with the nature and needs of corporate reporting. The latest thinking from FEE, the Federation of European Accountants, represents yet another brave effort to solve the conundrum. It proposes the idea that companies should produce information in two sections, the essential ‘CORE’, as FEE puts it, and ‘MORE’, which would be the detailed information.

FEE comes from the familiar position of not being sure how technology will change the game in the near future and knowing that many more people are coming to see themselves as part of a much wider audience than the traditional band of shareholders, potential investors, lenders and capital providers. This is where the users of non-financial information, and those who see societal pressures other than the strictly financial ones having as much of an effect on how a company’s strategy and business model pans out, reside. Hence the focus on change, momentum and a wide panorama of corporate connections which would sit, in FEE’s model, in the CORE & MORE.

It is, to revert to the traditional arguments, an attempt to reconcile the analyst dilemma. Analysts will argue that they want to be provided with the essential kernel of a corporate story. And they will also argue that they would like a huge mass of undifferentiated information which they can slice into to find the kernel themselves. Trying to put both sides of these desires into one document has always proved problematic.

And change over the last generation or so has altered the focus. In the days when tangible assets made up the overwhelming majority of the corporate story the financial information stood proud. Now, when intangible assets are in the majority, it is no surprise that concepts like integrated reporting seek to make sense of the wider range of corporate drivers and information. 

But at the heart of all this change remains the fundamental of an annual report providing what investors need. This is where the noise is filtered out, the wood itself identified, the data filleted. And the way that annual report is configured and how the assurance which gives it credibility is attained is where the focus still needs, narrowly, forensically and clearly, to be applied.