Watchdog wants the power to name firms who alter accounts
(City A.M. (UK) Via Acquire Media NewsEdge) THE AUDIT watchdog wants the right to name and shame when it asks a company to make changes to its accounts - a relatively rare request and one that can embarrass the company and its accountants.
The proposal put out to public consultation yesterday by the Financial Reporting Council (FRC) is part of wider efforts to ensure markets are fully informed if the watchdog is unhappy with aspects of financial statements or company auditors.
Companies can choose now whether to disclose any amendments ordered by the FRC, as aerospace engine maker Rolls-Royce did in February when it had to restate its 2012 figures and adjust results for 2013.
Depending on the gravity of the FRC''s enquiry, companies may be forced in future to disclose the intervention publicly.
The explanation for failing to meet accounting rules would also have to be fair and balanced, and the watchdog would need to be given an opportunity to comment, the FRC proposal says.
(c) 2014 City A.M.
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