Modernising corporate reporting

Why this matters to internal auditors

Although corporate reporting is often associated with financial statements and disclosures, the consultation extends well beyond traditional financial reporting.

The proposals touch on issues that are central to the work of internal audit, including governance, risk management, internal controls, organisational resilience and assurance. They also raise important questions about how organisations communicate information to investors, creditors and other stakeholders, and what information is most useful in supporting decision-making. 

Internal auditors are uniquely placed to contribute to this debate. Through their independent and objective assurance role, they have a practical understanding of how governance arrangements operate in practice, how risks are identified and managed, and how organisations can demonstrate accountability and transparency.

As reporting requirements continue to evolve, it is important that the profession's perspective is reflected in discussions about the future of corporate reporting.

What is the Government consulting on?

The consultation considers reforms across almost every aspect of the annual report and accounts.

Areas under consideration include:

• financial reporting requirements;
• non-financial reporting;
• corporate governance reporting;
• remuneration reporting; and
• digital reporting and communications.

The Government is seeking views on how the reporting framework could be made simpler, more proportionate and easier to navigate. The proposals form part of the Government's broader objective of reducing regulatory burdens while maintaining confidence in UK corporate reporting.

The proposals include consideration of:

• the overall purpose of corporate reporting;
• whether current reporting obligations remain appropriate;
• opportunities to reduce duplication and complexity;
• the thresholds and exemptions that determine reporting requirements;
• greater use of digital reporting; and
• the longer-term role of technology, including artificial intelligence, in corporate reporting processes. 

The consultation also explores the future of governance reporting and the information companies provide about strategy, risk, internal controls and other financially material matters.

These are areas where internal auditors can offer valuable practical insight based on their experience of supporting good governance, effective risk management and organisational resilience.

Issues we are particularly interested in

As we develop the Chartered IIA's response, we would welcome views from members on a range of issues, including:

• Whether the proposals strike the right balance between transparency, accountability and reducing regulatory burden.
• The potential implications for governance and oversight.
• The future role of governance, risk and internal control reporting.
• How assurance can continue to support confidence in reported information.
• The opportunities and risks associated with increased digital reporting.
• Any unintended consequences that could arise from the proposed reforms.

We are particularly interested in hearing from practitioners with direct experience of governance, risk management, internal controls, corporate reporting and assurance activities. Please submit your feedback by 6 November.