Corporate Reporting blog

Business reporting in this economic environment – communication is critical

On Thursday 9 February I will be hosting a webcast to share our insights on reporting and accounting in today’s tough environment, explain what investors want to see in the annual report, and look ahead at what’s likely to change. We’ll also take a look at some of the critical issues that both audit committees and we, as auditors, are focusing on before we sign off annual reports.

Headline-grabbing economic concerns in Europe are shaking market confidence. And the current after-shocks make it all the more critical that companies communicate clearly to their stakeholders about the impact events are having on their business. 

Looking on the bright side (and as I’ve mentioned in my previous postings), we’re seeing a positive response from investors and regulators to those companies that provide some additional, pertinent disclosures to help reassure the markets.  But that doesn’t mean adding ‘clutter’- far from it. It means demonstrating that the business critical issues, such as securing funding for borrowings, acquisitions or capital projects, are being effectively managed. It means inspiring confidence in your business model and its resilience in this environment. And it means building trust in the appropriate governance of your business.

The webcast starts at 09.00 GMT and you can access it here at:

http://www.pwcplayer.co.uk/webcasts/0212_corporate_reporting_webcast/

We’ll talk for about 20 minutes, after which we’ll be answering questions from the audience.

I hope this webcast will inspire you to join the reporting debate and look forward to hearing your comments, either on the live webcast or here on my blog.

BFN

Charles

Investors speak out on disclosure - Winning the competition for capital

I thought I would share with you the attached 'Investor view - Winning the competition for capital': as it makes for interesting reading.  The document outlines key areas that investors would like to see entities disclose and the frustrations they have with current reporting.                          

Our conversations with investment professionals tell us that entities that don’t make their cash and debt disclosures clear and accessible may find it more difficult to raise capital or borrow funds. But management teams can take simple steps to improve their chances of securing the right funding at the right price by making some simple voluntary disclosures.  You may also be interested in a series of short webcasts featuring investors from around the world talking about why this is so important.

Do please keep in touch - I really value your responses to this blog.

BFN

Charles

Streamlining the annual report – Losing the excess baggage

As we settle back into the reality of January and start to break those well intentioned New Year resolutions, what was planned to be significant change often resorts back to how life used to be.  Oh well there’s always next year!  Corporate reporting however, unlike many of our resolutions, is experiencing a period of significant change. The demand for change is being driven by various parties fed up with the loss of key messages in lengthy reports that are hard to navigate and that contain immaterial or repetitive disclosures. 

The FRC report “Cutting Clutter” hits the nail on the head - “....cutting clutter cannot be achieved just by taking a red pen to a late printer’s proof. Making a significant and permanent change has to be addressed at the planning stage for the next annual report through a clear idea of the desired outcome and how change will be achieved”. 

So at a time when companies are increasingly revisiting their annual reports to see how they can make improvements, I thought it was timely to draw your attention to a recent PwC practical guide looking into streamlining the annual report.  I hope you find the report helpful.

I also wanted to draw your attention to an opinion piece I recently co-authored for PwC’s World Watch magazine entitled “From compliance to competitive edge”. The article explores how taking a compliance-driven approach to corporate reporting is becoming the risky option.  It is time to take positive action so that reporting gives us a competitive edge.

Do please keep in touch - I really value your responses to this blog.

BFN

Charles

A new year and a new beginning for a busy 2012

A belated Happy New Year.

The New Year is always the time to reflect on the past and plan for the future. I am very much looking forward to leading our work on the reporting agenda.  I take over the mantle at a time when building public trust and the demand for better quality disclosures in reporting have never been so relevant.  There has been a lot of activity over the past few weeks which will have a knock on effect for reshaping the reporting agenda in the foreseeable future. 

The Report Leadership Group – of which PwC is a member - has launched its corporate governance paper as a result of the heightened focus on the corporate governance of public companies.   Investors are increasingly demanding the need for management to go beyond simple compliance, and communicate their governance effectively to stakeholders. The paper offers simple, practical proposals for better reporting of corporate governance.  

One of the last places investors go to understand how well a company is governed is its governance statement because it fails to tell them what they need to know. The paper is designed to stimulate ideas rather than provide a one-size fits all solution to reporting. The aim is for better rather than more disclosure, and disclosure that is adapted to the circumstances of the company.

The deadline for comment on the IIRC's discussion paper "Towards Integrated Reporting" has now also passed with more than 50 leading companies signing up to take part in its integrated reporting pilot programme, with more expected to join soon. Coca-Cola, Microsoft, HSBC, Akzo Nobel, Volvo and Aegon were among the international participants at a kick-off meeting in Rotterdam back in October marking the start of the two-year project to develop an integrated reporting framework.  The IIRC pilot programme will see the companies exchange knowledge and share experiences that will feed into development of the IR Framework, which aims to address key corporate reporting challenges.   I share the sentiments of Paul Druckman, Chief Executive Officer at the IIRC, that "this is very exciting as different companies implement IR in different ways, and these participating companies, representing various sectors, will help demonstrate how this can be done"

2012 will be a busy year on the reporting front. A great deal of the research and thought leadership from the last few years is coming together with practical and joined-up initiatives.  I am therefore really looking forward to the year ahead.

Do please keep in touch - I really value your responses to this blog.

Bye for now.

Charles