Companies told to be open about country risks

The Financial Reporting Council has told companies to be more open about their exposure to debt-ridden European economies and politically unstable Middle East territories.

In guidance for directors, published today, Britain's corporate governance regulator said firms must provide "a balanced and understandable assessment of the company's position and prospects in the context of increased country and currency risk". Stephen Haddrill, the chief executive of the FRC, urged companies to act to improve "market confidence in corporate reporting".

He said firms should in future include details of country and currency risk in their annual and half-yearly financial reports.

As well as detailing exposure to risk, businesses should also consider the impact of austerity measures on forecasts and impairment testing, the FRC said.