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The FRC has published an updated version of its Guidance on the Strategic Report.
Currently under the CA 2006, all companies (other than those which meet the small company exemption) are required to produce a strategic report as part of their annual report and accounts, as are in-scope LLPs and qualifying partnerships. The disclosures required in the strategic report, however, depend on the nature of the reporting entity and so the FRC has produced separate Scoping Tables which summarise the application of the various disclosure requirements set out in the CA 2006 for the strategic report. The tables, which were previously set out in appendices to the Guidance but are now separate documents, also cover the disclosure requirements of the directors' report and the requirements for LLPs.
Other changes made to the Guidance, which was last published in June 2022, follow a comprehensive review by the FRC and include:
- updating it to reflect amendments to the reporting framework, such as the 2024 edition of the UK Corporate Governance Code;
- highlighting the Guidance's non-mandatory nature; and
- improving its structure so that it is arranged thematically, rather than by reporting entity type, and to aid its accessibility.
The Guidance is drafted to distinguish between mandatory requirements and guidance which relates to good practice, suggestions or examples.
The FRC expects to make further changes to the Guidance in the light of the government's anticipated review of the UK corporate reporting regime (see our blog post here).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
