FRC Lab publishes a report on blockchain

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21 Jun, 2018

A new report from the Financial Reporting Lab of the Financial Reporting Council (FRC) concludes that “whilst cost, complexity and lack of standardisation of blockchains might be inhibiting factors, the growing use of blockchain means that those involved in corporate reporting processes need to consider its potential disruptive impact”.

The Lab considered how current developments and use-cases of blockchain technology might impact corporate reporting processes in the future. In the report, the Lab  identifies what it calls ‘challenges’ in corporate reporting and attempts to identify whether blockchain can solve some of these looking specifically at the areas of  production, distribution and consumption of corporate reporting. 

The report highlights that “blockchain has the potential to change some aspects of accounting, reporting and auditing, but this is unlikely to be imminent or all-encompassing.  Blockchain therefore merits consideration and experimentation by preparers, regulators and others involved in the corporate reporting ecosystem”.

The report recommends actions for various groups which would allow the idea of blockchain to be taken forward including:

  • Regulators, standard-setters and professional bodies who are encouraged to monitor blockchain developments and consider how they may impact corporate reporting. The creation of a forum where all those involved in corporate reporting can share and learn is recommended.
  • Preparers and users of corporate reporting who are encouraged to focus on gaining a greater level of understanding and consider experimentation and cautious innovation when costs and benefits are balanced.

Please click to access the press release and report on the FRC website.

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