BT accounting fraud: new controls and clawbacks expected

BT: Accounting irregularities revealed in Italian operation

Communications company BT has admitted improper accounting practices at its Italian subsidiary which resulted in overstated earnings over several years. BT is now conducting a broader review of financial processes, systems and controls across the company. BT’s remuneration committee will also consider the wider implications of the investigation. … Read the rest

IOSCO pushes on international accounting standards and benchmarks

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The International Organization  of Securities Commissions (IOSCO), which represents global financial regulators, has published a statement on implementation of new accounting standards related to revenue, financial instruments, and leases.

The three new International Financial Reporting (IFRS) Standards, issued by the International Accounting Standards Board, are expected to significantly affect the financial statements of many issuers globally, IOSCO said, due to the breadth of their applicability.… Read the rest

CFA-UK calls for better company reports

New research from the CFA-UK, the membership association of financial analysts, highlights aspects of financial reporting in annual reports which investors feel need to be improved.

CFA-UK members were asked to rank the sections of annual reports by their usefulness.  … Read the rest

UK’s FRC targets thematic reviews to improve reporting and audit

The UK’s Financial Reporting Council (FRC) has announced that in 2017 it will carry out a number of targeted thematic reviews of company reporting and audit on issues it knows to be of shareholder interest and where weaknesses have been identified.… Read the rest

Sports Direct 2016 accounts to be investigated

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The Financial Reporting Council (FRC) has commenced an investigation into retailer Sports Direct’s accounts following reports earlier this year that there was an arrangement between Sports Direct and Barlin Delivery which was not disclosed as a related party in the company’s 2016 financial statements.… Read the rest

Tense Australian proxy voting season

Shareholders of Australian companies are showing their muscle in this year’s proxy season with significant opposition votes over the governance of retailer Harvey Norman and a rejection of executive pay at the Commonwealth Bank of Australia.

The Australian Shareholders Association has called on the chairman of  Harvey Norman, Gerry Harvey, to resign and for an independent non-executive director to replace him.… Read the rest

UK lays out post-Brexit #corpgov strategy

brexit-flags It is important for the UK to continue to retain its reputation across the globe for the trustworthiness of corporate reports and for audit quality which attracts investment, Sir Win Bischoff, the Financial Reporting Council’s (FRC) chairman said at the recent Financial Services Brexit Summit.… Read the rest

How should annual reports be reviewed? FRC consults on new procedures

The UK’s Financial Reporting Council (FRC) is consulting on its conduct committee’s operating procedures for reviewing company reports and accounts.

The conduct committee is a committee of the FRC Board established under the Articles of Association. The committee has a statutory duty to carry out reviews of the company reports and accounts to ensure they are meeting financial and accounting rules – including Financial Conduct Authority rules – and to respond to complaints about them.… Read the rest

Survey questions directors fiduciary focus

FTSE 100 companies paid more out in dividends to shareholders last year than the combined pension deficit figure according to the annual Accounting for Pensions report produced by pensions advisers Lane, Clark Peacock (LCP).

The survey found that the combined pension deficit of the 56 companies in the FTSE 100 that disclosed a deficit at their 2015 year-end was £42.3bn while those same companies paid dividends totalling £53.0bn, some 25% higher in 2015, while they paid around five times as much in dividends as they did in contributions to their defined benefit pension schemes. … Read the rest

UK’s Financial Reporting Council publishes revised audit firm governance code

The UK’s Financial Reporting Council (FRC) has revised the audit firm governance code aiming to improve its visibility, relevance to investors and increase its alignment to the UK’s corporate provenance code. This follows a review carried out into the implementation of the original 2010 code between 2014-2015 and a consultation into the draft revised code published last December.… Read the rest