PracticeAuditBarrage of criticism greets OFR proposals

Barrage of criticism greets OFR proposals

The DTI's consultation on proposals for the operating and financial review closed on Friday to noises of mounting dismay. The ICAEW predicted investors would be 'put to sleep' by OFR statements, while leading accountants told the DTI to rethink the stringency of requirements.

Link: Institute slams OFR proposals

Eric Anstee, chief executive of the ICAEW, warned that the planned changes – designed to create greater transparency in reporting of strategy and performance – could backfire.

‘The effect of these overly prescriptive proposals, coupled with an onerous verification regime, could lead to a decline in the quality of OFRs,’ Anstee told officials.

At a Moorgate Place forum, the DTI’s accounting adviser Andrew Watchman endured an uncomfortable few hours. Having claimed the OFR could create value, he was forced to hear a litany of reasons why it would not.

Elsewhere, ACCA criticised the proposals for not going far enough. Richard Martin, ACCA’s head of financial reporting, said: ‘They have labelled areas concerning environmental and social impact as “discretionary”, which clearly opens up the possibility that certain companies won’t provide that information.’

Martyn Jones, a partner with Deloitte, called for ‘at least a year’s delay’ for the introduction of the OFR.

The DTI said it was aware of the concerns, but would not make any decisions until it had looked at all responses.

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