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Corporate Review - financial reporting and Takeover Panel proposals

12 April 2011

In the March edition of Corporate Review we look at a number of recent developments regarding financial reporting.

In particular, a statement by the Financial Reporting Review Panel seems to have extended the scope of information which companies will be expected to include in their business reviews. In this context it is interesting that, in HM Treasury and BIS’s recent Plan For Growth paper, the government promises to simplify materially the narrative reporting framework. Also, the Financial Reporting Council has announced an inquiry into going concern and liquidity risk reporting.

The Takeover Panel has published detailed proposals for changes to its rules following the Kraft/Cadbury deal.

The ICAEW has issued two useful new papers: TECH 01/11 on the requirement for companies to keep adequate accounting records; and TECH 02/11 about managing the professional liability of accountants.

We also report on a number of interesting cases. One recent case has highlighted how limited the courts’ powers are in relation to severing an unenforceable clause from the rest of a contract. Another case has considered the requirements for giving notice of a breach of warranty claim. And, finally, the Court of Appeal has analysed the “balance sheet” insolvency test and, separately, considered when tortious liability can arise in relation to a contract.

If you would like to receive a full copy of the March edition of Corporate Review, please speak to your usual Allen & Overy contact or email