Ofwat has launched a consultation on regulatory reporting for water companies for the 2021-22 reporting year.
One of the three goals set out in Ofwat’s strategy is to transform water company performance.
A key part of this is through publishing information about how the companies are performing to help Ofwat, customers and other stakeholders to hold companies to account.
The regulator will use this insight to understand the progress that is being made in improving the industry’s performance and in meeting long-term aspirations. This insight will shape Ofwat’s policy priorities and focus areas.
All monopoly companies are expected to decide how best to report their performance each year but the water regulator also expects companies to publish some common information.
All companies are therefore required to publish an Annual Performance Report (APR). Ofwat sets out specific mandatory requirements for the form and content of the information within it.
Companies are expected to be transparent about their performance in their APRs and explain clearly, and in a balanced way, what is driving performance, and the steps they are taking to improve. This should cover all aspects of performance, including financial and operational.
The consultation covers the following areas:
- Proposals for Ofwat’s reporting requirements for 2021-22.
- Potential new requirements for future reporting.
The reporting requirements for the APR are contained in Ofwat’s regulatory accounting guidelines (RAGs), which set out the information companies must collect and publish, and ensures that data is published consistently across the sector.
The RAGs set out Ofwat’s expectations for the content and form of information in the APRs,
including the treatment of particular items (for example, revenue and interest) where
Ofwat disclosure and accounting requirements differ from those normally required
under UK accounting standards and applicable legislation.
This consultation seeks stakeholders’ views on proposed changes to the RAGs and highlights potential changes to take effect in future years.
The regulator intends to publish the revised RAGs in late 2021. These changes will be effective for the 2021-22 reporting year.
The closing date for this consultation is 8th of July 2021.
More information about this consultation and how to take part is available on the Ofwat website.
