Digital reporting in the UK: state of play and resources for companies
The Financial Reporting Council (FRC) Financial Reporting Lab has published the results of a survey carried out in May 2021. This asked companies and service providers to comment on their preparations for the introduction of structured electronic reporting for annual financial reports, being implemented in the UK as part of the wider European Single Electronic Format (ESEF) initiative. The Lab has also created a very useful list of resources to illuminate the reporting requirements and process.
“Preparers have begun to put the right steps in place with many having undertaken an analysis of the requirements and identified service providers. Key remaining actions are to run a test and engage the board. Our experience of ESEF is that testing the approach and mapping the annual report are critical to a successful implementation,” says the survey report. It suggests that testing should be conducted at a stage where lessons can be fully fed into the process, and that using a prior-year annual report for testing is a popular approach.
Interestingly, the survey also asked companies which other reporting areas they would digitally tag if a taxonomy were available. Taskforce on Climate-related Financial Disclosure (TCFD) reporting emerged as the frontrunner, with a number of other environmental, social and governance (ESG) areas mentioned as future priorities. The report notes that the FRC supports the wider digitisation of corporate reporting, and that it plans to add a number of further voluntary ESG-related tagging options to the UK Single Electronic Format (UKSEF) 2022 taxonomy suite.
The Lab is also reviewing a set of UK and EU ESEF filings, with the aim of publishing a best practice report this autumn, and is keen to speak to stakeholders to learn from their experience – so get in touch if you have thoughts to share.
Read more here.