Worthing Book Keeping, one of the South East’s top bookkeeping firms, have responded to news that the country’s leading accounting watchdog, the Financial Reporting Council (FRC), has warned retailers they must be more transparent.

The warning from the UK’s largest watchdog comes after accounting scandals this year rocked retail giants Premier Foods and Tesco. The FRC says that businesses must embrace transparency in regards to supplier arrangements, warning that they’re currently monitoring different methods employed by auditors and accountants for estimating revenues and profits.

The council called on suppliers and retailer boards, amongst others, to provide their investors with more information.

A statement released by the FRC reads: “Investors need to receive enough clear and relevant information to be able to evaluate the company’s performance and financial position where such amounts are, or could become, material.”

Chairman of the financial reporting review panel at the FRC, Richard Fleck, explained: “Complex supplier arrangements such as fees and discounts may have a significant impact on the reported margins and other results of a company and on investors’ views of its performance. Today’s announcement is a reminder to board of retail companies in particular of what they should consider and encourages them to review their reporting in this area as many have already announced.”

The warning comes after Tesco went public in September announcing they had discovered a massive gap in profits measuring £263m – the result of significant accounting irregularities.

Already, a criminal investigation has been launched by the Serious Fraud Office, putting the accounting practices at Tesco under the microscope. Additionally, the accountants involved in the Tesco case could face unlimited fines as a result of the ongoing FRC probe.

Worthing Book Keeping, a Sussex-based company who often share their thoughts on relevant research and news, believes the warning should act as a wakeup call to retailers.

A representative for Worthing Book Keeping said: “The effect that this has had on Tesco has been substantial. Already, the supermarket has lost billions of pounds worth of stock market value and a number of their top executives, and this is just the start. We believe the investigation into Tesco’s £263m overstatement could take a number of years to reach a conclusion, causing the company significant damage and hurting their momentum and growth.

“What’s happening to Tesco serves as a warning to other retailers. The best thing that can happen now is for others to review their reporting and ensure that they’re fully transparent.”

Worthing Book Keeping is one of the top book balance and data entry companies in West Sussex. They provide a number of commercial solutions, including VAT returns, annual accounts preparation and Sage accounts training. Visit http://worthingbookkeeping.co.uk/ to find out more.