They were meant to give investors more information but clearly some interim management statements (IMS) are adding very little value. Our equivalent to America’s quarterly reports, the IMS regime was introduced in January on the back of a new European Union (EU) directive, yet communications consultancy Radley Yeldar, which has surveyed the first 29 IMS announcements issued by FTSE 100 companies, has found a huge variation in quality. One company put out a 28-word statement – water supplier Severn Trent (SVT) – while nuclear power group British Energy (BGY) waffled on for a dissertation-busting 13,000 words, covering over 29 pages.

‘Investors are faced with huge variation in the quality and quantity of information provided,’ comments Richard Carpenter, development director at Radley Yeldar. ‘The basics of clear communication seem to have gone out of the window.’

As far as content goes, there was little consistency in the way financial information was presented – only 46% of companies produced supporting financial data in tabular form. Meanwhile, 14% of the companies surveyed didn’t meet a requirement to discuss the company’s financial position at all, says Carpenter.

The IMS requirement, which stems from the EU’s Transparency Directive, has been written into the Financial Service Authority’s (FSA) rulebook for companies listed on the London Stock Exchange’s main market. It says an IMS should produce an ‘explanation of material events and transactions.’

The new rules, which came into force in January, only apply to companies with years beginning after January 20. Management has to publish an IMS between ten weeks after the start of the financial year and six weeks before the end of the first half. It was predicted companies would try and get away with saying as little as possible and now Radley Yeldar is calling on the FSA to produce more prescriptive rules.