Mario Christodoulou, Accountancy Age, Friday 20 August 2010 at 09:40:00

FRRP report calls for improvement to reporting standards

AIM-listed businesses still have some way to go before they catch up withtheir established FTSE-listed counterparts when it comes to the quality of theirfinancial reporting, a study of company accounts has found.

The Financial Reporting Review Panel (FRRP) has found there is room forimprovement in the general quality of reporting by some smaller listed andAIM-quoted companies in its annual report released yesterday.

The panel reviewed 308 sets of accounts during the past year with 146companies approached by the Panel for further information and three shamed intorestating reported figures.

The board said it invested a lot of time asking companies to resolveinconsistencies
</br>between narrative information in the front end of annual reports and the
</br>audited accounts in the back end.

?This is likely to remain a key area of interest for the panel,? the FRRPsaid in a statement.

?We will focus on opportunities for clear linkages between the narrative
</br>and accounts; principal risks and uncertainties for example, but alsodescription of
</br>the business model which drives the policies and other solutions adopted in the
</br>financial statements.?

Bill Knight, Chairman of the emphasis on narrative reporting reflects changesin the law and ?an increasing call for reports and accounts to tell a coherentstory, with an eye
</br>to the future as well as the past?.