OFR delay confirmed
The government will announce next month that it is to delay the introduction of the operating and financial review, as predicted by Accountancy Age.
Link: OFR delay irritates investors
The three-month delay until the end of March 2005 will allow companies and standard setters extra time to prepare for the new rules.
The department of trade has received scores of complaints about the timing of the OFR’s introduction, and earlier this month Ian Mackintosh, head of the UK Accounting Standards Board, said it ‘looked almost impossible’ to complete a standard in time for the initial deadline.
A DTI spokeswoman said an announcement was expected next month on the timing of the OFR’s introduction, following comments during consultation.
But while the move to delay the OFR has been welcomed by those within the accounting profession, there are still some concerns about the impact on directors’ liabilities.
CIMA chief executive Charles Tilley argued that the liability of directors should be fair and reasonable or every word will be vetted by lawyers and the OFR would fail to live up to its potential.
Will Rainey, financial reporting partner at Ernst & Young, said an ‘extra three months will not remove the threat of “boilerplate” reporting’ where directors sign off bland statements to avoid legal liabilities.