The present content of the report has been stated in terms of the PWC value framework applied for Assa Abloy. The main experts of the study will examine the different types of the areas pertaining to the activates such as sourcing of the information from the strategic objectives, stakeholder relationship, performance and resources. The important considerations of the report will also include the various types of the other extent of the discussions which will be focused in terms of aligning the decision-making framework of the organization with the use of the appropriate accountability concepts.
Reporting Critique
The discussion on the competitive aspect can be identified under Globalization benefits of ASSA ABLOY. The reporting critique for the competitors can be further found in terms of the value creation in distribution. The product leadership offerings are also stated under the annual report.
Accessibility
The accessibility of such an information can be depicted under the markets overhead stated with markets under page 13 of the annual report. The information on the product leadership can be depicted in terms of the product leadership heading which is shown under page 30 of the annual report.
Comprehensiveness
The comprehensiveness can be depicted in terms of the local presence in terms of the competitive advantages. The similar concept is also applicable to the globalization trend of ASSA ABLOY for promoting the various aspects of smart and cost-effective approach. The competitiveness in terms of the product leadership can be depicted with the offering of the new products pertaining to the high innovation rate. The launching of the new products has further accounted for 25% of the overall sales.
Overall Conclusion
ASSA ABLOY is discerned to carry out the competitor’s risk analysis on both social and local level. Moreover, it has considered significant disclosures on the global scope of competition associated with the company thereby making the overall disclosure process as good.
Reporting Critique
The scope of information as per the regulatory framework can be found under Report on other legal and regulatory requirements. These is significant scope of information declared as per the accounts and the consolidated accounts. The geo political context of the information has been stead under the risk management disclosure.
Accessibility
The expert of information on Report on other legal and regulatory requirements can be sourced in page 101 of the annual report. Moreover, there is significant nature of the information leading to the geo-political changes in the business which can be duly referred in pages 10, pages 13 and page 26 of the annual report.
Comprehensiveness
Overall Conclusion
It can be seen that despite of the sufficient nature of the disclosure on the Report on the legal and regulatory requirements in terms of the Responsibilities of the Board of Directors and the Managing Director and Auditor’s responsibility. However, there is a significant gap of information pertaining to the geo political changes. Therefore, such a disclosure pertaining to this information can be seen to be bad.
The reporting critique as per the economic information can be identified in terms of the various types of the disclosures made under research and development. The economic benefits are stated with the impact on intangible assets and PPE disclosures.
Accessibility
The accessibility of this information can be seen under page 70 of annual report. This is directly stated under Research and development. The economic benefits are also stated under the other intangible assets and PPE disclosures in page 70.
Comprehensiveness
Overall Conclusion
The overall depictions of the information show that there is significant nature of reporting for the economic impacts there is considerable number of sources included by the company in their annual report with the implication on intangible assets and PPE. Therefore, such a reporting of information can be stated as good in nature.
Reporting Critique
In the section of goals and outcomes it can be seen that there is significant disclosure of the information considered with the social KPI.
Accessibility
The social KPI information can be extracted from page 7 of the annual report.
Comprehensiveness
Overall Conclusion
The company has stated about various sources of the information pertaining to the information associated with the injury rate and role of women in management positions. In addition to this, there is considerable amount of disclosure pertaining to the initiatives taken by the company to allocate noteworthy position to be held by women. Due to large variety of information available pertaining to social initiatives this disclosure can be depicted as good.
Reporting Critique
There has been significant portion of information stated with the disclosure of Global Technologies.
Accessibility
The information on the Global Technologies is stated under page 58 of the annual report.
Comprehensiveness
Global Technologies is depicted with an organic growth of 7%. The acquisition and the divested units are seen to be pertaining to the contribution of 5% of sales pertaining to the technological initiatives. The contribution of global technology in the operating income has been represented with a contribution of 15% pertaining to the global technologies.
Overall Conclusion
It can be concluded that there is very less information pertaining to the disclosure of technology. Therefore, such an information can be depicted as ugly.
Reporting Critique
The various types of strategy frameworks are outlined in value creation section. This is included under the vision of the company.
Accessibility
The value creation strategy section can be accessed in the page 6 of the annual report.
Comprehensiveness
Overall Conclusion
There are large number of initiatives taken by the company pertaining to market presence, product leadership and cost efficiency in terms of strategy objectives. Therefore, such a declaration of information is seen as good.
Reporting Critique
The important consideration of business model for the company can be identified with formulation of Value creation for all stakeholders’ model.
Accessibility
ASSA ABLOY’s value-creating model can be accessed in page 8 of the annual report.
Comprehensiveness
The value creation model as the segregated into six broad headings. This includes
Overall Conclusion
It can be overall concluded that there have been significant disclosures pertaining to business model which have stated about overall value creation pertaining to security, convenience, safety and profitable growth. Therefore, such a disclosure can be identified to be good in nature.
Reporting Critique
The reporting of adequate disclosure pertaining to governance can be found under sustainable development. There is also sufficient disclosure of corporate governance.
Accessibility
The governance under sustainable development can be sourced from page 36 of the annual report. The information on disclosure of corporate governance can be seen in page 46 of the annual report.
Comprehensiveness
The various nature of responsibility pertaining to operational sustainability is defined among the code of conduct associated to the business partners which is inspired with several types of sustainability commitment prepared with GRI standards code. The corporate governance structure has been clearly demonstrated by the company in terms of shareholders, Gen meeting, nomination committee, CEO, audit committee, executive teams and other divisions. The governance aspect is also defined with the preparation of the financial performance report and statement of cash flows as per annual accounts act (PwC. 2018).
Overall Conclusion
There is a vivid range of information available pertaining to role of governance in terms of sustainability and reporting and consolidation functions. Henceforth, such a disclosure can be considered as good.
Reporting Critique
The important nature of disclosures pertaining to risk management is considered under the report prepared by board of directors. In addition to this, the company has segregated strategic risk, operational risk and financial risk under significant risk management heading.
Accessibility
The significant risk management framework can be accessed in page 41 and 42 of the annual report.
Comprehensiveness
Overall Conclusion
It can be depicted that there is a wide range of information available in terms of strategy crisp domains, financial risk and operational risks. Therefore, such lucidness in the information is good in nature.
Reporting Critique
The important scope of information available for the remuneration can be identified with Remuneration guidelines to senior management. The company has also stated the remuneration provided to the board of directors. In addition to this, there is a significant information pertaining to remuneration committee.
Accessibility
Remuneration guidelines to senior management can be found under page 55 of the annual report. The information on remuneration committee and remuneration for the board of directors can be found under page 49 of the annual report.
Comprehensiveness
The important duties under the remuneration committee have been considered with drawing up the remuneration for senior management and preparation of proposals which evaluates matters associated to bonus, pension, severance pay and salaries. The minutes to the remuneration committee is also prepared as per the negotiations and evaluations in matters pertaining to pension, bonus and salaries. In addition to this, the board of directors of the company have proposed the guidelines for the remuneration as per the employment conditions of President and CEO along with other members of ASSA ABLOY Executive Team. The total expenses pertaining to the remuneration of the executive team is included under the several types of previous commitments but not yet reported (PwC. 2018).
Overall Conclusion
Despite of the considerable expanse of information disclosed with the remuneration guidelines to the senior management and immigration for the board of directors there is still scope for improvement. Therefore, such a disclosure of information is identified as ugly.
Report Extract: Page 92:
Report Critique:
The characteristics of reporting that determine the financial asset framework element:
Extensiveness & Accessibility:
Apart from the other framework of the PWC, to access the information of the financial asset is very easy. The company has mentioned regarding the financial assets in the content page and has later provided a detailed description of the asset in the page 92. Assa Abloy has provided an extensive information on the policies governing the measurement of the financial asset.
Comprehensiveness:
Under the notes section of financial instruments the company has treasured the policy that aims to reduce the risk and make sure that it is able to maintain sufficient amount of liquidity to conduct its business operations. Assa Abloy has provided information regarding the derivative instrument hedge account and derivative instrument for trading account as well. Assa Abloy has addressed regarding the currency swaps and indicators of the previous performance.
Conclusion & Strength:
Assa Abloy financial assets is communicated in detail and inside the framework of pwc reporting. Therefore the overall quality of reporting is good.
Report Extract: Page 78
Reporting critique
The characteristics of reporting that determine the physical asset framework element:
Extensiveness & Accessibility:
Assa Abloy has declared regarding the techniques involved in the measurement of the physical assets in the annual report. The information is easily accessible through the content pages and under the notes sections. The accounting policies stated under the notes section focuses on the new amendments made in the asset impairment methods.
Comprehensiveness:
The reporting of the Assa Abloy property plant and equipment is much wide as it covers the following
Conclusion & Conclusion:
In regard to the Assa Abloy physical asset reporting the company quality of overall presentation can be termed as good for the readers.
Reporting critique
The characteristics of reporting that determine the Customers framework element:
Extensiveness & Accessibility:
Assa Abloy as the global firm has not provided a detailed information regarding the number of customers. The company has only provided information relating to the geographical segments and percentage share of group.
Comprehensiveness:
More widely speaking, the comprehensiveness regarding the geographical segments is very much extensive but lacks specific country wise targets and comparative view of the customer revenues.
Conclusion & Strength:
As it is anticipated Assa Abloy has not provided much of the information regarding the customer. The only relevant information is geographical wise distribution of customer share. The overall quality of reporting is for customers of Assa Abloy is bad.
Reporting critique
The characteristics of reporting that determine the People & Culture framework element:
Extensiveness & Accessibility:
Under the heads of the sustainable development stated under page 36 Assa Abloy culture and people is easily accessible. This includes the following;
Comprehensiveness:
The company has provided the wide breath of reporting regarding the people and culture. Both the qualitative and quantitative aspects of the reporting is stated in the annual report.
Conclusion & Strength:
The reporting aspects of Assa Abloy People and Culture is wide which covers strong safety culture. Therefore, Assa Abloy overall quality of reporting is good.
Reporting critique
The characteristics of reporting that determine the Innovation G&S framework element:
Extensiveness & Accessibility:
Assa Abloy continues to be the global leader in the innovation it is markedly expressing its business strategy through extensive communication regarding the innovation undertaken for quality products and services.
Comprehensiveness:
The company has only made qualitative references only and the report does not provide any improvement in the internal system. The report also lacks depth in providing information on forecast benefit.
Conclusion & Strength:
The importance of innovation is expressed strategically but quality of reporting lacks coverage. Hence the overall quality of innovative reporting is ugly.
Reporting critique
The characteristics of reporting that determine the Brand & Intellectual Assets framework element:
Extensiveness & Accessibility:
Assa Abloy being the innovating oriented company has provided very little information on the brands recognition and intellectual assets. The company in the introduction part has made reference to the number of brands and the reporting diminishes in the depth of the report.
Comprehensiveness:
The research and development and intellectual property does not covers much of the performance details. The company has only talked about brands that are leaders in the market segments. It does not includes any values or trends.
Conclusion & Strength:
Assa Abloy overall reporting of Brands and Intellectual Assets is ugly.
Reporting critique
The characteristics of reporting that determine the Processes & Supply Chain framework element:
Extensiveness & Accessibility:
The company has provided very less amount of information regarding the processes and supply chain. The supply chain of Assa Abloy includes explanation regarding the internal process. The company makes an extensive reference regarding the distribution channel and distribution partners being the key drivers of business but lacks substantial reporting any substance.
Comprehensiveness:
The comprehensiveness of Assa Abloy Processes and Supply chains includes the following
Conclusion & Strength:
The overall quality of Assa Abloy Process & Supply chain reporting is ugly as there are numerous metrics that may be incorporated by the company to add value to the users.
Report critique:
The characteristics of reporting that determine the operational performance framework element:
Extensiveness & Accessibility:
The performance indicators of the company is provided in detailed with greater level of overview and internal management nature given in annual report.
Comprehensiveness:
The main performance indicators of the company is given under page 4 that comprises of the following attributes:
|
Depth involved in the reporting |
Description of the performance measure |
|
Definition of the KPI |
The computation involved in the computation of the key indicators of performance that is linked with the strategy of the firm |
|
Remark |
The key performance metrics of the company is inside the framework of reporting |
|
2018 |
The company has set down the target to significantly measure the performance |
|
Linkage of the remuneration |
The impact of the key performance indicators is calculated by using the bonus plan |
Conclusion & Strength:
Though the depth that is prescribed in the annual report of the PWC framework has not been stated in the annual report of the company but Assa Abloy general reporting of the operational performance can be termed good.
Reporting Critique:
The characteristics of reporting that determine the Economic performance framework element:
Extensiveness & Accessibility:
The financial performance of the Assa Abloy is widely communicated and reported in the element of framework inside the yearly annual report. The vital economic performance of the company is communicated in page 4 that effectively draws the attention of the readers with supporting segments of the accounts and explanations are recorded under the accounts notes. Commenting upon the financial ratios the definition of the key ratios and computation of the ratio is performed slatternly in the report.
Comprehensiveness:
Each of the financial segments of the performance is listed by comparing the figures of the current year with the previous year’s results. This allows the readers to understand the trend in the performance. Assa Abloy however lacks the depth as they have failed to provide the readers with the comparison regarding the outcomes of the comparable firms. In order to provide a better view to the readers of the financial statement the company has broken down the additional information in the notes sections. This includes;
Conclusion and Strength:
Assa Abloy economic performance has been clearly articulated which is prominent with the report. It provides the readers with the vision of business performance that is be supported by the financial ratios. The overall quality of the presentation of Assa Abloy economic performance is good.
Reporting Critique:
The characteristics of reporting that determine the Social performance framework element:
Extensiveness & Accessibility:
The social performance of the company has been one of the main factors that is reported in the Assa Abloy annual report. It also includes the wider part of the corporate social responsibility of the company’s annual reporting.
Comprehensiveness:
The social performance of the company is reported under the five areas which includes the following;
Conclusion and Strength:
The company has exclusively incorporated the total number of elements inside the corporate social responsibilities to in order to reflect the ability of the company’s commitment towards the social performance and transparency. Assa Abloy overall quality of social reporting is good.
Reporting Critique:
The characteristics of reporting that determine the Environmental performance framework element:
Analysis & Accessibility:
Just like the social element, Assa Abloy reporting of the environment effect is incorporated by the company in the social responsibility report. One of the most vital environmental reporting is integrated sustainability reporting for its certified products. A graphical review is presented by Assa Abloy that aims to reduce the green houses by 20% in 2020.
Comprehensiveness:
The company has reported on the below stated vital main areas
Conclusion and Strengths:
Assa Abloy has focussed exclusively in its annual reporting regarding the sustainable greenhouse emission and target set down to reduce the emission in future. The overall quality of environmental reporting is good.
Reporting Critique:
The characteristics of reporting that determine the Segmental performance framework element:
Segment wise performance- Assa Abloy has presented its segmental performance by breaking down the revenues derived geographically and has placed its focus in the internal value creation and operation performance.
Accessibility and Extensibility:
Assa Abloy segmental performance is communicated extensively in the annual report both in terms of the qualitative and quantitative all through the annual report. The performance of each segments is communicated namely the EMEA, America, Asia Pacific, Global Technologies, Entrance System and Others.
Comprehensiveness:
|
Depth involved in reporting |
Explanation of the focus |
|
Key performance indicators |
a. Growth in the revenue b. Growth in the net income c. Earnings before interest and tax d. Cash flows e. Operating cash flows |
|
Market trends and drivers of growth |
Quantitative drivers of vital growth |
|
Geographical trends |
Underlying drivers of the global growth |
|
Strategy |
Connecting the strategy of the company |
|
Outlook |
Long term future growth opportunities and sustainable business |
Conclusion & Strength:
The details stated in the Assa Abloy annual report regarding the segmental performance offers an insight to the readers regarding the company’s segment wise performance. The quality of Assa Abloy segmental reporting is good.
Materiality is defined as disclosure of significant information which consists of specific financial information which are important for decision-making of a user. Moreover, the company reports the financial statements as per materiality in case of absence of information pertaining to decision-making. This is important to be considered for decision-making as per fairness and honesty. Every company chooses a different set of methods for reporting of materiality depending on the nature of business, the size of business and the culture followed by the company. There are several indications while choosing of the materiality aspect by a company. There can be significant nature of information which can impact on the investors were making the decisions pertaining to company’s values (PwC. 2018).
Report Critique
The significant scope of information pertaining to materiality for ASSA ABLOY is defined with procuring reasonable assurance whether the financial statements are free from material misstatements. The company has further stated in its annual report that these misstatements can arise as a result of any error or fraud. As per the significant nature of the professional judgement, the quantitative thresholds of materiality are included under scope of audit which is seen with nature, timing and extent of application of audit procedures for evaluating the impact of misstatements on both financial statement and aggregate. Similarly, there is also a significant portion of information which is related to disclosure of the key audit matters. Moreover, based on the risk pertaining to the key audit matters, the company has made several provisions for reconciling the parameters including calculations done against the supporting documents and examination of the minutes (PwC. 2018).
Conclusion
It can be discerned that there is significant nature of information revealed as per the external and internal context in the financial statement. Based on the external drivers there is a considerable amount of information declared in terms of competitive strategy, regulatory framework, economic and social disclosures. Similarly, under the strategy initiatives the company has demonstrated ample disclosures for strategy objectives, business model, governance and risk factors. Similarly, under resources and relationships the most significant disclosures can be identified with financial assets, people and culture. The shows the effectiveness of company in depicting information pertaining to organisational health in terms of internal context. Lastly, it is worth mentioning that the performance factors have been duly noted by the company in terms of operational disclosures, economic disclosures and social disclosures. Therefore, the overall assessment of information in the annual report can be said to be good in nature as per the PWC value framework.
References
ABLOY, A. (2018). assaabloy.com. [online] assaabloy.com. Available at: https://www.assaabloy.com/en/com/ [Accessed 27 Sep. 2018].
ABLOY, A. (2018). Investors. [online] assaabloy.com. Available at: https://www.assaabloy.com/en/com/investors/ [Accessed 27 Sep. 2018].
PwC, P. 2018. Pricewaterhouse Coopers (PwC) | Integrated Reporting. [online] Integratedreporting.org. Available at: https://integratedreporting.org/profile/pricewaterhousecoopers-nv-netherlands-accounting/ [Accessed 26 Sep. 2018].
PwC. 2018. Our Purpose. [online] Available at: https://www.pwc.com/us/en/about-us/purpose-and-values.html [Accessed 26 Sep. 2018].
Pwc.com. (2018). Implementing Integrated Reporting [online] Available at: https://www.pwc.com/gx/en/audit-services/publications/assets/pwc-ir-practical-guide.pdf [Accessed 26 Sep. 2018].
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