Ministers back down over OFR legal term
Ministers have backed down over a legal clause in the operating and financial review that would have increased the duty of directors and auditors certifying the new corporate reporting requirement.
Link: OFR delay confirmed
The trade department which has already delayed by three months implementation of the OFR – a mandatory, forward-looking narrative report to be included in annual reports, is expected to announce that it has erased the term ‘due and careful inquiry’.
Auditors and business groups have been lobbying the DTI to remove the phrase because it would make the document a ‘quasi-legal’ review, The Financial Times has reported.
Industry observers say the inclusion of the phrase could discourage company directors from including meaningful information for fear of being held liable if the company wasn’t successful in achieving its stated aims.