The Financial Reporting Review Panel has highlighted potential reporting issues for companies in the worsening economic climate.

In a report based on the assessment of 300 company accounts, 138 of which were contacted by the panel which sought further information or explanation on various accounting items.

The panel has also advised company directors to be mindful of subsequent changes in accounting.

Sources of uncertainty affecting management’s estimates, revenue recognition criteria and relationships with special purpose entities have been highlighted as areas to note.

Panel chairman Bill Knight said that UK company directors are known for their compliance with standards, and the report has been designed to address areas more sensitive to change.

‘The panel is less likely to question directors whose business model is clear, who avoid boiler-plate descriptions and who are open about the specific risks and uncertainties that may challenge their business in the foreseeable future,’ said Knight.