Corporate Reporting Requirements: FRC Overview

The Financial Reporting Council (FRC) has warmly welcomed the UK Government’s new corporate reporting requirements, aimed at strengthening trust, transparency, and accountability in business. These new regulations will introduce an annual Resilience Statement, which outlines how a company manages risk and builds or maintains resilience in the short, medium, and long term. Additionally, companies will need to produce a triennial Audit and Assurance Policy Statement, detailing their plans for assuring nonfinancial reporting for the next three years, and an annual statement about distributable profits and their policy on distributions. Furthermore, businesses will have to give an annual statement on their actions to prevent and detect significant fraud. These enhanced requirements are expected to contribute to an environment of trust and foster long-term investment, financial stability, and business integrity, thus bolstering the resilience of the UK economy.

Boosting Trust and Resilience: Unpacking the UK's New Corporate Reporting Requirements

In a proactive move to reinforce trust, transparency, and accountability in business, the UK Government, in collaboration with the Financial Reporting Council (FRC), has introduced a series of innovative corporate reporting requirements. These requirements present a unique set of challenges and opportunities for diverse financial institutions, including banks, insurance companies, asset management firms, and investment entities, making the UK a strong contender in global financial integrity.

Aimed at fortifying business resilience and financial stability, these regulations notably mandate an Annual Resilience Statement, a Triennial Audit and Assurance Policy Statement, and a yearly statement on distributable profits, distribution policy, and anti-fraud measures. While these changes may increase the reporting burden, they signal a transformative shift towards enhancing risk management and demanding heightened transparency in corporate operations.

Under the spotlight is the new Resilience Statement, calling upon businesses to disclose their risk management strategies in the short, medium, and long term. This level of transparency could forge deeper trust between companies and stakeholders, potentially spurring economic growth through increased investment. Moreover, a robust and modern reporting regime could bolster the UK's reputation for high reporting standards, making it an attractive destination for international businesses and investors.

Moreover, the push for accountability in financial reporting through the Audit and Assurance Policy Statement presents an opportunity for institutions to showcase their robustness against financial mismanagement and fraud. This proactive stance on business integrity could amplify the country's corporate governance standards, attracting even more investment to the UK.

Financial institutions must embrace these changes by updating their reporting processes, strengthening their risk management procedures, and fortifying their anti-fraud systems. The timeline for implementation, although not specifically stated, suggests an immediate need for action to ensure readiness for the upcoming reporting cycles.

In summary, the UK's new corporate reporting requirements offer a chance to enhance not only the transparency and resilience of individual businesses but also the overall financial stability and reputation of the UK. With careful planning and proactive compliance measures, these changes could signify a new era of trust and investment in the UK financial sector.

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https://www.frc.org.uk/news/july-2023/financial-reporting-council-welcomes-new-corporate