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The Journey: From OFR To Business Review

Below are the recent milestones in narrative reporting that have taken us from mandatory OFR to statutory Business Review:

• March 2005: legislation in force to require quoted companies to prepare an OFR and all other companies (except eligible small companies) to expand their Directors’ Reports to include a Business Review.
• May 2005: the Accounting Standard Board (ASB) issued an accompanying Reporting Standard (RS 1). Those companies complying with RS 1 were presumed to have complied with the OFR Regulations.
• November 2005: The Chancellor announced Government’s intention to scrap the requirement for quoted companies to prepare an OFR.
• December 2005: The DTI updated their guidance on the changes to the Directors’ Report requirements in the Companies Act 1985.
• January 2006: The Companies Act 1985 (Operating and Financial Review) (Repeal Regulations) 2005 becomes effective thereby removing the requirement for quoted companies to produce an OFR.
• January 2006: The ASB converts RS 1 into a Reporting Statement. This is a voluntary guidance for those companies producing an OFR. 
• February 2006: Government invites comments on any considerations which ministers should take into account in deciding whether, and if so how, further to amend narrative reporting requirements.
• March 2006: Consultation closes.
• May 2006: Government announces proposed amendments to the Business Review legislation.
• November 2006: The Companies Act 2006 (www.opsi.gov.uk) is given royal assent.  The changes to the Rusiness Review requirements for quoted companies are finalised.

Business Review Team Contacts:

Richard Sharman	Partner	0207 311 8228
Andrew Fields	Principal Advisor	0207 694 3282

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