Financial Reporting

Corporate reporting improvement
(Students to note that almost all the input are taken from website of PwC)
Reporting more comprehensively on important non-financial assets can often improve the valuation of your company in the capital markets. PwC research shows that investors and analysts consider financial reports by themselves to be of limited use in determining a company's prospects. That shouldn't be too surprisingmanagement itself doesn't rely solely on financial information in running its business. Your company's brands, market share, customer retention levels, and intellectual capital are of intense interest to investors.
The reasons for Improvement required in Corporate Reporting:

Analysts and investors do not understand your company's value proposition. You need to expand the portion of your annual report to meet new requirements. You want to get a headstart on complying with the EU's Transparency Directive. You need confidence in the validity of your nonfinancial information. Your business performance is hampered due to poor management information. You want to know how your company's corporate reporting compares to your competitors'. You want to improve the transparency of your corporate reporting.
When it comes down to IFRS reporting, then we need to understand the various stages of the IFRS reporting lifecycle including: Conversion to IFRS Preparation of IFRS financial statements Regulatory compliance Capital market transactions Valuation Systems support Corporate governance
Questions to be replied?
1.What aspects of the system are preventing or supporting the effective development of corporate reporting? And what changes are needed to make the system fit for purpose for the future? 2. What are the weaknesses and strengths in the current system? 3. What are the barriers obstructing the evolution of corporate reporting? 4. What solutions would you propose to rectify these weaknesses?
Some of the changes which may be Incorporated in future Financial / Corporate Reporting, are as follows:
Climate change bill sets ambitious targets to tackle climate change The climate change bill will see mid-sized companies face mandatory reporting of their carbon emissions from 2012, and commits Britain to slash all six of the main greenhouse gas emissions by 80% by 2050. Whilst not defining exactly how big a company has to be to fall within the rules, new responsibilities are placed on large and medium-sized companies to disclose their carbon emissions and sets out a process for establishing more rigorous common reporting standards. Under the bill, from 2012 corporate reporting will be mandated. Prior to this, ministers plan to review how it should be implemented and will retain power to introduce a voluntary scheme if that is considered to be more effective. There will also be a consultation on whether smaller businesses should face the same reporting requirements. Either under existing regulations or voluntarily, many companies already disclose their carbon dioxide output. Heavy industry covered by the EUs emissions trading scheme must monitor their discharges, while under government regulations called the "carbon reduction commitment", thousands of retail outlets, banks and other commercial premises will have to begin emissions trading from 2010.
SEC requires interactive online reports In the coming months, the Securities and Exchange Commission (SEC) plans to require that all publicly traded U.S. companies and mutual funds prepare their financial filings using a new interactive system that allows the information to be viewed and analysed online. Within two years, the SEC will require all corporations and mutual funds to file using Extensible Business Reporting Language (XBRL) with the first wave beginning in December.
More transparency needed in energy company accounts The business secretary has urged energy companies to address the 'lack of transparency' in their accounts or face the possibility of opening their books to reveal the profits of their supply and generation arms. According to the Financial Times, John Hutton believes potential new entrants to the market do not have the data they need due to the failure of some big integrated energy companies to record separately their profits in generation and retail, which holds back competition. He also commented that the recent big domestic energy price rises announced by various power companies appeared hard to explain when they were making big profits across their business
Company reporting requirements review launched Following consultation with stakeholders earlier this year, the Financial Reporting Council (FRC) has launched a project to review complexity and relevance of current company reporting requirements. The scope of the project includes requirements relating to financial statements, accompanying management commentary and other reports. The first goal of the project will be to understand the causes of complexity in corporate reporting and engage the community in a debate about how to stop complexity increasing further. According to the FRC, "the increasing size of and complexity of company reports has become a subject of growing concern among investors, accountants, auditors and others with an interest in clear and relevant corporate reporting", yet any attempts to simplify or streamline reporting requirements have often been met with stiff resistance from one or more groups of stakeholders.
Marketing Key Performance Indicators missing "KPIs for marketing reporting: A framework for effective marketing disclosure", a new guide from the Institute of Practitioners in Advertising (IPA) has found that marketing Key Performance Indicators (KPIs) are still absent from the company reports of the FTSE 350. This is despite brands forming an average 12% of a company's value. The publication explains why marketing KPIs are left out of such reports, why they should be included, what the measures of marketing success are, and how to predict them. Some 20 KPIs have been identified and categorised including 'measures of success', 'predictors of success' and 'financial metrics'. Five KPIs are highlighted as key: value market share, ratio of new to existing to lapsed customers, share of voice relative to share of market, ratio of winning to mediocre to unsuccessful campaigns, and marketing payback. The IPA is also calling for three additional changes in reporting practice to aid marketing disclosure: to standardise advertising and promotions reporting; include a marketing section in the narrative report and make marketing reporting an agenda item at every board meeting. In PricewaterhouseCoopers' opinion, companies should only report the information set which management use to manage the business and measure strategic progress. Therefore for those companies where an appreciation of marketing and success is strategically relevant might find this a useful guide.

Financial Reporting

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Corporate reporting improvement

The reasons for Improvement required in Corporate Reporting:

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