FRC review of tax reporting

The FRC has announced that its Corporate Reporting Review team will be conducting a thematic review of companies’ tax reporting to encourage more transparent reporting of the relationship between tax changes and other disclosures. It will be writing to a number of FTSE 350 companies shortly to inform them of the review.

The review team will consider all relevant disclosures in the strategic and other narrative reports as well as the detailed accounting disclosures. It will focus in particular on:  

  • the transparency of tax reconciliation disclosures and how well the sustainability of the effective tax rate is conveyed; and

  • uncertainties relating to tax liabilities (and assets) where the value at risk in the short term is not identified.