Our Financial Reporting Expert Group contributed to our response to the FRC consultation – FRED 65: Draft Amendments to FRS 101 Reduced Disclosure Framework – Notification of shareholders.
We supported the draft amendments proposed in FRED 65, which removes the requirement for a qualifying entity to notify its shareholders in writing that it intends to take advantage of the disclosure exemptions in FRS 101, as well as the consequential amendment in FRS 102.
However, we also noted that removing the ability of minority shareholders to object to companies using the reduced disclosure framework could result in potential situations where minority shareholders are both unable to obtain more information and insist that a company issues a more complete disclosure. We encouraged the FRC to fully assess whether this is a desirable policy objective.
