The Association of Chartered Certified
Accountants (ACCA) said achieving more effective communication in
corporate reporting will help the Financial Reporting Council (FRC)
attain its goal of more active involvement in corporate affairs by

In response to the FRC’s consultation paper,
Effective Company Stewardship: Enhancing Corporate Reporting
and Audit,
the ACCA’s head of technical, John Davies, says the
association would like to see the annual report redefined as a
regulatory document, focused on brevity, relevance and

“The sheer amount of data and wording that is
included in modern annual reports can be a detriment to good and
transparent communication,” he said.

The ACCA says it supports the FRC’s proposal
to expand the scope of the audit and the role of the audit
committee. Davies says he believes the audit adds value to
stakeholders’ understanding of a business’ position, but cautions
not to overload the audit committee or have unrealistic
expectations of what they can achieve.

In response to the move towards integrated
reporting, Davies said the long-term aim to fuse financial
information with much of what is currently found in narrative
reports could improve stakeholder’s understanding of how companies
are performing.