Included in this issue: Gender pay gap information now available online; IA guidance on long-term reporting; GDPR - 12 months to go and more...

Company Law

ICAEW updated guidance on realised and distributable profits

The Institute of Chartered Accountants in England and Wales and the Institute of Chartered Accountants of Scotland has published TECH 02/17, which provides updated guidance on realised and distributable profits under the Companies Act 2006 and all relevant secondary legislation.

Corporate Governance

Gender pay gap information now available online

The Government's gender pay gap results site is now up and running (in beta format), showing the results of the few employers who have decided to report their results. By way of reminder, the new regulations require employers to publish their median and mean pay gap figures by April 2018. Employers must also publish the proportion of men and women in each quartile of the pay structure and the gender pay gaps for any bonuses paid out during the year.

Only the bare figures are reported, with no field for an employer's voluntary narrative, which is a little surprising given the emphasis placed on providing a narrative in the ACAS / GEO guidance.


Pre-Emption Group monitoring report and appendix of best practice

The Pre-Emption Group (Group) has published a monitoring report looking at the implementation of its 2015 Statement of Principles (Principles) for disapplying pre-emption rights and on the use of the template resolutions for disapplying pre-emption rights which were published in May 2016.

The Principles attempt to provide a framework for early and effective dialogue and is supported by the Investment Association (IA) and Pensions and Lifetime Savings Association. However, while the Group believes that the Principles and template resolutions have generally been adhered to, possible examples of poor consultation or disclosure have been brought to their attention. For that reason, the Group has included in the report an Appendix of Best Practice in Engagement and Disclosure. For further information, please see our Governance & Compliance update.

Narrative Financial Reporting

IA guidance on long-term reporting

The IA has published guidance on long-term reporting directed at companies with shares admitted to the premium segment of the Official List. Other listed companies and those on AIM have been encouraged to adopt the guidance as best practice. The guidance follows the publication in November 2016 of a public position statement in which the IA called for companies to cease reporting quarterly in favour of meaningful long-term reporting. For further information on the IA's guidance, please see our Governance & Compliance update.

FRC discussion paper on preliminary announcements

The Financial Reporting Council (FRC) has issued a discussion paper focussing on the use and value of preliminary announcements, and the role of the auditor in respect of them. The FRC intend to use responses to the discussion paper when updating its current auditor guidance. The paper contains an evaluation of the current auditor guidance in relation to preliminary announcements, reviews current market practice across the main market and AIM and makes various proposals for change. For further information, please see our Governance & Compliance update.

Market Abuse Regulation

MAR: ESMA updated Q&A (May 2017)

The European Securities and Markets Authority (ESMA) has published an updated version of its Q&A on the Market Abuse Regulation (MAR). This includes a new question (Qn. 5) which deals with the disclosure of inside information related to Pillar II requirements – i.e. whether relevant institutions are required to publish systematically the results of a Pillar II prudential assessment. In its answer, ESMA reminds issuers which are credit or financial institutions of their ability under Article 17(5), with the prior consent of the relevant competent authority and provided certain other conditions are met, to delay the disclosure of inside information in order to preserve the stability of the financial system. This is in addition to the general ability of all issuers to delay the disclosure of inside information under Article 17(4) where, among other conditions, immediate disclosure would prejudice the issuer's legitimate interests. However, ESMA underlines the need for each issuer to evaluate whether such results meet the criteria of inside information in each case. If the conclusion is that inside information does exist and the conditions needed to delay disclosure in Articles 17(4) and 17(5) respectively have not been met, an issuer would be required to publish that information as soon as possible.

ESMA also takes the opportunity to remind issuers of their obligations as regards rumours in the market which relate explicitly to inside information which exists within the issuer.


GDPR - 12 months to go 

On 25th May 2018, the General Data Protection Regulation (GDPR) will come into force. We have produced the attached Timeline, which sets out an action plan for those affected by GDPR to follow over the course of the next year to ensure their readiness for it. We hope you find it useful.  

Key Contacts

Nicky Higginbottom

Nicky Higginbottom

Principal Knowledge Lawyer, Corporate
Leeds, UK

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