Revised minimum reporting requirements for public sector
22 May 2020: HM Treasury have issued an addendum to the 2019-20 Financial Reporting Manual (FReM) that set out new minimum reporting requirements for public sector bodies.
The new requirements are not permanent changes to the FReM and have been brought in to ease the burden on account preparers. The relaxation in requirements only relates to the performance and accountability report; the audited elements of the accounts – the financial statements and disclosures – remain unchanged. However, preparers are encouraged to consider materiality within the current framework and assess whether content is immaterial by value and/or nature. Engagement with auditors on this is being advised.
Performance report: Amongst other relaxations of requirements, entities are no longer required to provide non-financial information on social matters, respect for human rights, anti-corruption and anti-bribery matters. Nor are entities required to provide information on environmental matters and sustainability reporting. Instead, entities have the option of only producing a summary overview of their performance. However, the summary should nevertheless provide the user with sufficient information to understand the organisation, its purpose, the key risks to the achievement of its objectives and how it has performed during the year.
Accountability report: The only changes to the requirements set out in the FReM in relation to the accountability report relate to the Statement of Parliamentary Supply (SoPS). The key relaxation is that there is no longer a ‘comply or explain’ requirement for the SoPS to follow the form of the illustrative disclosures. This gives preparers more flexibility.