Private equity "reinvigorated" corporate reports

News Article - 24 May 2012
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The increase in companies being taken out of public ownership and into private equity has had dramatic implications for management reporting, it has been claimed.

According to the Financial Director, private equity corporate reports are now "reinvigorated and refocused".

"The difference can be summed up in one word - cash," the publication stated. "In contrast to traditional due diligence, private equity want to know about issues of liquidity - how much cash and when."

Business goals of productivity, growth, liquidity and innovation are at the forefront of private equity reports, it continued, explaining that stakeholder demand for more detail has only furthered the trend.

Such disclosure in management reporting arose from suspicion and distrust of the industry, the news source added, as investors demanded the ability to monitor business progress in the face of economic uncertainty.

Although the private equity industry continues to self-regulate, the Walker report, finalised at the end of 2007, included a number of proposed guidelines for large companies to follow.

Private equity companies contributed £35 billion in tax contributions last year, according to the British Private Equity and Venture Capital Association, which produced the report.

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