Do we British give too much away?

UK companies are being put at a competitive disadvantage vis-a- vis their Continental European counterparts as a result of having to disclose more information about their affairs, according to a report by the accountants Deloitte & Touche.

The firm says the survey, Annual Reports: Aiming for a Level Playing Field in Europe, published earlier this month, "indicates clearly" that the quality of disclosure required of UK companies is far higher than for other European countries. "Indeed, the survey revealed no category of disclosure in which the UK fell behind Germany, France or Italy."

It is the sort of finding that would go down well with the Euro-sceptic camp in politics - except that Martin Scicluna, chairman of Deloitte & Touche, insists that he does not want be in the direction of European practice. "I share the concerns of the directors of UK plcs. I am, however, firmly of the view that we should encourage other countries to bring their standards of financial reporting up to our own level, rather than reverse the move towards full and clear disclosure that helps maintain London as Europe's leading financial centre," he says.

The study looked at the annual reports of 40 leading companies in Britain, Germany, France and Italy - 10 from each country- and involved reviewing 18 disclosures, in such categories as segmental analyses, corporate governance, cash flow and directors' remuneration, that provide information that may be useful to competitors or trading partners.

"When a company is up against overseas competition, it is at a competitive disadvantage if its competitors publish less information about their activities than it does about its own. UK plc has the right to be treated by the regulators no more harshly than Deutschland GmbH, France SA, Italy SpA and others. We need to work towards a financial reporting regime that allows UK companies to compete fairly on the international playing field," he says.

In particular, he wants the International Accounting Standards Committee to seek the support of stock exchanges and businesses around the world on an international version of the operating and financial review recently introduced in Britain.

"My vision for the `International OFR' builds on the success of the UK OFR by providing an attractive option to companies that falls short of full compliance with a rigid set of international accounting standards," he adds. "At the same time, we should ensure that we do not tip the scales against UK companies still further by introducing additional reporting requirements for UK companies unless they are really necessary".