Businesses 'struggling with forward-looking data disclosures'

News Article - 16 January 2007
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According to the Accounting Standards Board (ASB), businesses which produce narrative reports as part of their annual accounts are finding it difficult to get to grips with the disclosure of forward-looking data.

The claim was made by the ASB after the annual reports of 23 listed companies were reviewed to see how they matched up with both legal requirements and best practice recommendations, reports Accountancy Magazine.

While a general level of compliance was noted with regard to legal issues, improvement was needed in the areas of providing forward-looking information, identifying key performance indicators, illustrating risks and uncertainties and recounting resources, the publication states.

Ian Mackintosh, the ASB's chairman, said: "Narrative reporting is an increasingly important feature of corporate reports, providing an opportunity for directors to set out a clear and balanced analysis of the strategic position and direction of their business."

He added that he was pleased to see that many businesses were providing greater detail in their reports and moving further towards best practice.

Last month, the ASB issued an exposure draft entitled Accounting for Heritage Assets with the aim of improving how such assets are reported upon financially by entities such as museums which hold collections of art.

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