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FRC sees improved transparency of tax reporting

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The Financial Reporting Council (FRC) has published its report on a review of certain aspects of tax reporting in company annual reports and accounts, finding evidence of improvements in the transparency of tax disclosures included in strategic reports and effective tax rate reconciliations.

The FRC wrote to 33 FTSE 350 companies in December 2015, announcing that it would conduct a thematic review of companies’ tax reporting, to encourage more transparent reporting of the relationship between tax charges and accounting profit in accordance with existing requirements. For the FRC, the improvement in disclosures, particularly among FTSE 250 companies, demonstrated the beneficial impact of this ‘pre-informing’ approach. However, the report found it ‘disappointing that no FTSE 100 company subject to the review stood out as a role model in their reporting of tax’.

The report, Corporate reporting thematic review: tax disclosures, is available here.

Issue: 1330
Categories: News , Corporate taxes