16 June 2005050616
16 June 2005
The Chartered Institute of Management Accountants (CIMA) today published a report that offers valuable insight to businesses reporting non-financial information for the first time; and for those struggling with the inter-relationship between their CSR reporting practices and the new Operating and Financial Review (OFR) regulations. The report details the findings of a roundtable meeting of experts from the regulatory, business and investment community on the impact the OFR will have on the sustainability practices of companies and their reporting.
The expert panel warns that in developing their reporting structure companies need to beware of:
- The relationship between the OFR and all the other parts of the corporate reporting 'package' ' the publication of the OFR is a good opportunity to ensure there is coherency overall.
- The OFR's potential to generate a better flow of information between companies and investors by providing a more structured context for non-financial reporting.
- The potential conflict between the directors' judgement of what is material and the demands of stakeholders for greater transparency.
- The danger of giving greater weight to financial or quantitative information, because it is perceived as more accurate than the narrative report, and diverting attention from the useful assessment of strategic performance potentially provided by the qualitative information.
Charles Tilley, chief executive of CIMA said: 'It is important to share our collective expertise on the most effective way to include sustainability information in the OFR, because many companies outside the FTSE100 will find it a challenge to collect and report information about sustainability-related issues. The timing of the OFR may need to be addressed in the future as it may be better to include it with the preliminary statements rather than just the annual report. Otherwise the OFR will come at the end of the process by which information is disseminated to key users, especially the sell-side and buy-side analysts.'
Notes to editors
1. CIMA (the Chartered Institute of Management Accountants) is a leading professional body that offers an internationally recognised qualification in management accountancy, focussing on accounting in business. It is the fastest growing UK based membership body, in terms of members, in both the UK and worldwide and is the voice of over 85,000 students and 65,000 members in 156 countries. CIMA is responsible for the education and training of management accountants who work in industry, commerce and not-for-profit and has more members in the public sector than any other UK based body. CIMA prides itself on the commercial relevance of its syllabus, which is in tune with the activities of high performance organisations, and evolves continually reflecting the latest developments in global business. It is committed to upholding the highest ethical and professional standards of members and students, and to maintaining public confidence in management accountancy. For more information about CIMA, please visit http://www.cimaglobal.com/
2. The roundtable was organised by Dr. Arlo Brady (Research Associate, Judge Institute of Management) and Danka Starovic (Technical Specialist, CIMA) and was sponsored by Mott MacDonald CSS. Organisations represented on the roundtable included, the ASB, Boots plc, DTI, Forum for the Future GUS, ICI, Insight Investment, Standard Life and Unilever.
3. The full report and executive summary can be downloaded in PDF format from: www.cimaglobal.com/ofrsustainability
For interviews, photographs and further information, please contact:
Linda Hardy Maskell
Chief Press Officer, CIMA
T: 020 8849 2347
E: Lynda.hardymaskell@cimaglobal.com