IT, property and media accounts face FRC scrutiny

Company accounts in the commercial property, media and Information Technology
industries are set to face greater scrutiny over the next two years, the
Financial Reporting Council has announced in a review of its activity.

Advertising and recruitment companies will also be examined more closely, the
UK’s financial corporate reporting watchdog, also said.

The Financial Reporting Review Panel said it will focus on sectors ‘that rely
heavily on discretionary spend and which might be stretched in the short term.’

In the past two years, the FRC has focused on banking, house-builders and
travel and leisure.

Bill Knight, chairman of the panel said: ‘Companies who are seeing their
business models develop to meet the challenges of the recession will need to
reconsider their revenue recognition policies to ensure that they still reflect
their business activities.’

The Panel will pay particular attention to accounts of companies which appear
to apply “aggressive” policies compared with their peers, Knight added.

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