KARACHI: The Evaluation Committee, a Joint sub- committee of ICAP and ICMAP organized a Discussion Session on the Revised BCR Criteria with CFOs here at ICAP House Karachi. It was attended by 80 CFOs and fund managers.
Naveed Abdul Hameed, ACA, made comprehensive presentation on “How it differs from <IR> and Sustainability Reporting.” He explained how the Revised Criteria would pave way transforming the traditional corporate reporting into the Integrated Reporting <IR>.
Abdul Rahim Suriya, FCA, FCMA, the Chairman of the committee in his presentation covered the key changes made in the revised Criteria of 2018 and the evolution of the Evaluation Criteria over the period of 18 years since the launching of Best Corporate Report (BCR) Awards in 2000. The main objective is to promote corporate accountability and transparency through the publication of timely, factual and readers’ friendly information.
He said that the Criteria focuses on the Content Element (Disclosures) as the starting point for encouraging companies to understand and adopt integrated reporting. Further that for other two elements of <IR> i.e. Guiding Principles and Fundamental Concepts, he informed that these would be addressed by adding a narrative guidance as a supplement to the Criteria and the objective evaluation would be covered through independent assurance.
The Criteria for BCR has been derived from: Content Elements’ of the <IR> Framework, IASB’s Practice Statement Management Commentary, ISA 720, “The Auditor’s Responsibilities Relating to Other Information”, Best practices around the world for corporate reporting, Specific disclosure requirements of local laws and regulations.
The content of the BCR Criteria comprise of (1) Organizational overview and external environment; (2) Strategy and resource allocation; (3) Risks and opportunities; (4) Governance; (5) Performance and position; (6) Outlook; (7) Stakeholders relationship and engagement; (8) Specific disclosure of the financial statements (9) Sustainability and corporate social responsibility (10) Business model (11) Striving for excellence in corporate reporting (12) Assessment based on qualitative factors.
Further, he highlighted some key additions the Criteria, as follows:
Qualitative assessment of annual reports; Timeliness for authorization is increased now from 30 days to 40 days; Unreserved compliance of IFRS; Summary of the Analyst briefing; Analysis of financial statements to cover ratios for Free Cash Flow, Economic Value AddedEVA and Break-up value of shares including Investment in Related Party at fair /marketvalue; Specific disclosures required by the Companies Act 2017such as Review report by the Chairman of the Boardand some additional disclosures in the Directors’ Report vis-a-vis Related Party transactions and other disclosures as per the 4thSchedule.
He emphasized that not only listed companies but also Non-Listed Public Interest Companies including Mutual Funds, Public Sector Companies and other Large Size Companies including NPOs should participate for transparency. It is noted that unfortunatelyonly one NPO participates i.e. TCF for BCR award.Pakistan is a generous country and NPOs usually receive most of the amounts on account of Zakat where transparency is very much desired.
Muhammad FaridAlam, FCA, the Session Chairman sum up the discussions followed by a Question-answer round. Responding to a question, he explained that the Criteria does not require disclosure of confidential informationrather it encourages companies to narrate substance of its achievements and sustainability of the company in the future for the benefit of its stakeholders. News Desk
