Mark Hynes - thoughts on corporate disclosure

Opinions on changing rules, changing best practices, and their effect on investor relations officers.

Thursday, March 24, 2011

Narrative reporting - any nearer a conclusion?

When we will see any conclusions to the narrative reporting debate published by Government. I sometimes feel like we're Theseus in the labyrinth - but without Ariadne's help to find the way out.

1. The BIS / Narrative Reporting Consultation Paper, which noted “The Government will publish its conclusions at the end of the year” closed in October 2010. In it they asked some very detailed questions, including on technology. BIS then published Long Term Focus also highlighting narrative reporting. BIS published responses to the Narrative Reporting consultation in December – in which they noted “Corporate governance including narrative reporting is one of the Government’s priorities for action in that review. As part of this programme, we will be bringing forward policy proposals by Budget 2011.”

Yesterday, BIS published its Plan for Growth, in which they say “The Government will materially simplify narrative reporting for quoted companies to make it clearer and more focussed”. They promise that they will seek views from business by the end of July 2011 on the best ways to reduce burdens. Are we going round in circles?

2. FRC meanwhile had promised an outcome from its Cut the Clutter by yesterday, when Stephen Hadrill said they will provide it “shortly”. And of course there proposals on narrative reporting in the Effective Stewardship on narrative reporting.

Meantime, there is a consistent stream of information on which we are asked to concentrate. Environmental information, going concern, risk, governance...all described as being most important. And the choices on how and whether to harness ‘technology’ move around from CP to CP.

And in the middle of this, annual report preparers are trying to plan their reports, and decide where to publish them.

Now, where's that Minotaur.


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