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FRC to name firms filing inaccurate reports

Businesses may soon have no choice but to admit to any investigations by the FRC’s conduct commission for giving inaccurate information in reports or accounts, should the watchdog’s proposals be approved.

The FRC is re-evaluating how it assesses company reports, and is planning to name those businesses which have been asked to modify their accounts after an inquiry.

Such requests are not made often; the conduct arm of the FRC reviews only around 250 company accounts per year.

Businesses can currently decide to refer to any FRC-ordered amendments. An example of this is Rolls-Royce, which disclosed its figures for a second time after an FRC investigation saw a change in how it documents its entry fees.

The proposal document includes the following:

“Our original practice was not to seek any further publicity in respect of committee references which are not mentioned in the current operating procedures.

“However, the steady rash of failures and disappointments emanating from within the business and financial community during the recent economic crisis raised a question concerning the trustworthiness of corporate activity.”

It went on to say that we now live in a world where transparency is the norm, and expected for trust to be restored.

The proposal only highlights the importance of good accounting. Should it be approved, businesses more than ever will need to ensure that they are providing accurate figures. They will undoubtedly be making their accountant, in the Wirral, Chester, or wherever they are based, aware of this very fact.

Posted by Peter
May 1, 2014
Small Business

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