Essential Corporate news – Week ending 2 May 2025

• FRC: Structured digital reporting - 2024/25 insights
• HMRC: Modernisation of the stamp taxes on shares framework
• ISSB: Exposure Draft proposing targeted amendments to IFRS S2 to ease application for companies published

FRC: Structured digital reporting - 2024/25 insights

On 28 April 2025, the Financial Reporting Council (FRC) published its annual review of structured digital reporting, highlighting key areas for improvement in how UK listed companies present their digital annual reports.

The report reveals that, while basic errors identified in previous years have been resolved, companies still face challenges with more complex aspects of digital reporting, and it provides guidance for companies to address persistent challenges so that the quality of financial reports (and their accessibility) can be improved.

Summary of key issues

Key issues are reported to include the following:

• Use of Custom Extensions - Custom tags/ extensions are often being created when not necessary. Unnecessary extensions create issues for those trying to analyse annual report data.
• Anchoring of Extension Taxonomy - Where extensions are used it is common for them to not be anchored correctly. Inaccurate anchoring can make it difficult for users to analyse the information as it is unclear what IFRS item it should be compared against across a peer group.
• Accounting Meaning - There are cases where the accounting meaning of the tags does not correspond to the facts reported or do not reflect the correct standard. Misreporting can lead to significant discrepancies in how financial statements are analysed.
• Incorrect Sign or Scale - There are cases where amounts are reported with the incorrect sign or scale. Signage refers to the sign, i.e. either positive or negative, appropriate to the numeric value being presented. Balance attribute specifies whether the financial concept is a debit or credit. Incorrect attributes can lead to significant errors in financial statements, affecting the reliability of the data presented.
• Missing Tags and Granularity - There are many cases where some 'mandatory' tags such as 'Principal place of business' or 'Domicile of entity' are not included or where the relevant level of granularity has not been applied. Missing tags and lack of granularity makes it difficult for investors to find the relevant information about a topic.
• Design and Usability - Design issues can still be a challenge for some filers. Many companies are also failing to put the file on their website or limit its value by delaying publication or not providing the tags in a viewable format.

In relation to each of these areas the report looks at the particular issue, explains why it is important and then sets out guidance on what companies can do in relation to that particular issue.

Next steps

To support better quality data, the FRC is further enhancing its review of digital reporting by carrying out a sample of reviews alongside its normal monitoring of annual reports. Where issues and errors in the tagging are identified the FRC may write directly to those preparers. The aim is that this work will further drive quality improvements in the sector and support better data for decision making.

The FRC also refers to the public viewer tool it launched in March 2025 that supports the use of company XBRL data across both listed and private companies. This UK iXBRL viewer enables users to easily view and analyse Inline eXtensible Business Reporting Language (iXBRL) files, displaying tagged data within reports and it represents a significant step forward in making company financial information more accessible and transparent to stakeholders.

(FRC, Structured digital reporting - 2024/25 insights, 28.04.2025)

HMRC: Modernisation of the stamp taxes on shares framework

HM Revenue & Customs (HMRC) have confirmed that they will reform the way in which the UK's regime for stamp taxes on shares works with a view to introducing the changes in 2027. Some detail was published on 28 April 2025 in the summary of responses to the 2023 Consultation.

Stamp duty and SDRT will be replaced by a single self-assessed tax on securities which will be paid via an online portal. A UTRN will be issued upon the submission of the tax return on the portal. Registrars will be able to register changes in ownership as soon as they receive the UTRN which will assist with the timing issues currently met in some transactions. The geographical scope of the new single charge has not yet been confirmed but the government has suggested that it is minded to use the existing SDRT rule which would mean the charge would apply to UK securities.

Other headline points to note at this stage are that the rules for contingent, uncertain and unascertainable consideration will largely follow the existing SDLT rules with a 4-year deferment backstop with an ability to extend to a maximum of 12 years in 4-year reapplication periods and that the current £1,000 consideration de minimis which applies for stamp duty will be removed. There remains a substantial amount of detail to be finalised and more will be known when draft legislation is published "in due course".

On 28 April the government also published a consultation on the 1.5% stamp duty charge. Transfers to a clearance service or depository receipt issuer attract a higher 1.5% charge, the rationale for which is that subsequent transfers within the clearance service or of the depository receipts do not attract further stamp duty charges. Responses to the consultation are requested by 21 July 2025.

(HMRC, Modernisation of the stamp taxes on shares framework, 28.04.2025)

ISSB: Exposure Draft proposing targeted amendments to IFRS S2 to ease application for companies published

On 28 April 2025, in response to market feedback, the International Sustainability Standards Board (ISSB) published an Exposure Draft proposing targeted amendments to IFRS S2 Climate-related Disclosures that would provide reliefs to ease application of requirements related to the disclosure of greenhouse gas (GHG) emissions.

The amendments are not focused on reductions in disclosures about GHG emissions but are aimed at making it easier for companies to apply the Standards while retaining the decision-usefulness of information provided to investors.

The proposed amendments clarify the GHG emissions measurement and relate to the application of GHG emissions disclosure requirements in IFRS S2. More specifically, the ISSB proposes to amend the requirements in IFRS S2 related to:

• the measurement and disclosure of Scope 3 Category 15 GHG emissions associated with derivatives and with specific financial activities related to investment banking (facilitated emissions) and insurance and reinsurance underwriting (insurance-associated emissions);
• the use of the Global Industry Classification Standard in applying specific requirements related to the disclosure of information about financed emissions;
• the use of a method for measuring GHG emissions other than the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (2004), if a jurisdictional authority or an exchange on which the entity is listed requires the use of a different measurement method for a part of the entity; and
• the use of global warming potential (GWP) values other than the GWP values based on a 100-year time horizon from the latest Intergovernmental Panel on Climate Change assessment available at the reporting date, if a jurisdictional authority or an exchange on which the entity is listed requires the use of different GWP values.

As optionality is embedded in the design of the amendments, entities can choose whether to apply the reliefs, and jurisdictions can choose whether to adopt them without affecting their degree of alignment with ISSB Standards. The reliefs should support preparers in applying IFRS S2 by reducing the risk of potential duplication of reporting and the related costs associated with applying the Standards.

The Exposure Draft will be open for comment for 60 days with the comment period closing on 27 June 2025. The ISSB aims to finalise these amendments by the end of 2025, subject to stakeholder feedback.

(ISSB: Exposure Draft proposing targeted amendments to IFRS S2 to ease application for companies, 28.04.2025)

(ISSB press release, 28.04.2025)