FSA reveals new disclosure code
The major UK-headquartered banks have agreed to implement a tough new code for financial reporting disclosure, the Financial Services Authority (FSA) has announced. The code forms part of proposals designed to enhance investors' confidence in financial reporting and to aid their ability to compare and contrast banks' performance. The regulator said it is inviting views on the application of the code to banks and other credit institutions but in the meantime the major banks, at the FSA's request, have agreed to implement the code in their 2009 year end annual reports. If the banks are unable to improve sufficiently the quality and comparability of their disclosures in their 2009 annual reports, the FSA said it was also seeking views whether the code needs to be supplanted by more detailed disclosure templates. "In the Turner Review we set out our view that the financial crisis had raised questions as to the adequacy of financial disclosure by banks throughout all major economies and the level of confidence that investors could place in their financial reports," said Paul Sharma, FSA director of prudential policy. "The tough disclosure code published today puts UK banks further ahead of the game internationally in addressing these concerns."