In this assignment, proper emphasis had been given on explaining the role of International Integrated Reporting Committee and this was done by referring to the International Integrated Reporting Committee website and use of applicable accounting literature. The current study explain about the possible roles of integrated reporting with respect to different attributes and these are stakeholder engagement, comparability of reporting, users of reporting, usefulness of reporting and quality of reporting. In the next segment, comparison had been conducted to understand findings of the CPA report in along with the guiding principles and some of these guiding principles are stakeholder relationships, reliability, materiality, conciseness, comparability and consistency. In addition to that, the study compares between the objective of International Framework and General Purpose Financial Reporting and this was clearly highlighted in the IASB or AASB conceptual framework. Furthermore, the study even compares between four companies where each of the company had been taken into consideration and explain in detail and these companies are HULAMIN LTD, DSM, MTN and CEMEX. These companies were compared as to whether the companies aligns or abides by the IR guiding principles and these are stakeholder relationships, completeness, reliability, comparability and consistency (Adams and Simnett 2011).
In this question, proper emphasis had been given to understand the role of the IIRC by gathering information from the IIRC website as well as relevant accounting literature. The International Integrated Reporting Committee can be termed as global coalition who act as a regulators and standard setters. In addition to that, the main role of this Committee is to propose a generally accepted framework in order to deal with a procedure that result in enhancing the level of communication within companies so that value creation can be done for given period of time (Brown and Dillard 2014). It was decided by the Committee to bring forward or identify the development areas that is possible by conducting internationally accepted integrated reporting framework. Proper concise communication can be enhanced within the companies if there is proper development of international accepted reporting framework as it will help the business to understand how they involve in value creation activities within specified time frame. Therefore, it is the responsibility of the International Integrated Reporting Committee to promote communication so that the companies can know how to create value in the next step and this can be done by development of commercial commentary.
Part A
Companies should always update about the information to the shareholders as they are always interested in getting access to these information about their work. Any of the environmental issues should be well communicated to the environmental stakeholders as they are interested in know the issues or significance at the same time. These environmental stakeholders have extensive but even gets access to varied informational needs and these needs cannot be well-addressed by any single or static or annual integrated reporting (Busco 2016). Therefore, most the stakeholders make use of reports and treat it as background information at the time of carrying out the research for a given company and the information was gathered by referring to the research findings of the CPA report as well as appropriate accounting literature.
Part B
It is the stakeholder who receives information through direct engagement with any of the Business Corporation or enterprises. The stakeholders should be well-informed about any changes planned by the companies as it is stakeholder engagement is necessary where the stakeholder after getting the information decides upon how to respond to the issues highlighted by the company (Cheng et al. 2014).
Part C
It can be seen that the integrated reports could not meet the informational needs for both the civic stakeholders as well as environmental stakeholders. It is the stakeholders who understand the issue or identified problems that results in comparability and quality of these reporting system.
Part D
As far as quality of integrated reporting is concerned, the financial stakeholders are of the opinion that this reporting reveals the variation through identified means. In addition to that, financial stakeholders reveals the fact that integrated reporting fails to reports most of case studies and even fails at the time of setting targets and even does not have narrations on how the given issues can be significant for any business. As far as environmental stakeholders are concerned, they engages in pointing out the issues where the reports fails to identify the right indicators such as amount of lending to fossil fuel projects and rendering headline information on some of the smaller issues.
Part E
While engaging in decision-making activities, integrated reports plays major role here and useful at the same time. The stakeholders had mixed views upon the usefulness of integrated reporting. Furthermore, it can be seen that the prime motive or objective of integrated reporting is to understand the perspectives of the stakeholders on understanding the usefulness of integrated reporting and this will be used while engaging in decision-making activities.
Part F
Users of reporting
It is essential to understand the fact that the users of integrated reporting are the stakeholders. It help in representing the producers of the integrated reports and it is compared with the usefulness of integrated reporting as viewed by different users of the reports.
3.Part A
Information was gathered from the CPA report and found out that maintaining relationship with the stakeholders is important and this was under the performance content elements that reveals as one of the major components as it explain about the stakeholder relationships (Cpaaustralia.com.au. 2018). On understanding the integrated reporting, it takes into account improved corporate reputation and stakeholders relationships. One of the guiding principles is stakeholder relationships here and it is being evaluated in the question by comparing this guiding principles as mentioned in the findings of CPA report and integrated reporting. In CPA report, this report states about the stakeholder relationships whereas in the integrated reporting it states about the performance as well as business at the same time.
Part B
Information was gathered from the findings of the CPA report and found out that environmental stakeholders were of the opinion that business should engage in disclosing the information that had impact on environment and society as a whole. The issue mainly governs around issue such carbon gas emissions and climatic change. It is the stakeholders who desired to disclose the materiality concepts and its related impact at the same time. For example, most of the companies who have relevant information about their own operations and deal with the case as and when needed. It is not that much important unless the business has some actual power generator or big energy user (de Villiers, Rinaldi and Unerman 2014).
Information was gathered from the integrated reporting and found out that materiality presumes and applies from the perspectives of value creation activities (Integratedreporting.org. 2018). In addition to that, this particular integrated framework should aim at disclosing the information that shows the ability of the business in creating for short-term, medium-term and long-term creation of value
Part C
Information had been gathered from the CPA report and it can be seen that business largely thinks about the conciseness of presenting information to the stakeholders. It was added by one of the reporters that due to in-depth analysis, it becomes impossible to access potential information. On the contrary, other reporters thought that identifying the challenge of keeping the report in concise way can be treated as one of the interesting and challenging task that takes into account collection of right information at the time of conducting business activities.
Information had been gathered from the integrated reporting and it can be seen that some of the reports finds it impossible to provide concise information as well as aim at presenting some context to the readers where the readers can understand the value creation process of business and level of performance in the most appropriate way (Dumay et al. 2016).
Part D
Information had been gathered from the CPA report and it can be seen that more than 10 stakeholders asked about the reliability of integrating reports. Some even argues that the integrated reporting is one of the reporting that renders assurance and verification of reports as it guides in boosting the level of confidence among the few stakeholders. In case of financial stakeholders, they believe that reliability can be found in varied form because it takes into account developing a reliability score during the assessment process. Some of the other financial stakeholders feels that the provided data should be reliable as far as possible. Companies should not involve in hiding any information from the stakeholders (Flower 2015).
Information had been gathered from the integrated reports and it can be seen that both reliability and completeness reveals about balancing between good and bad news. It was further noted that the reliability principles were good as more than 68% of the reports reveals used neutral factual language and properly manages to further avoid looking at certain elements such as materiality and promotional tools at the same time. It is important to involve in bringing improvement in the materiality determination process and this can be done by providing reliable and complete information to the stakeholders (García-Sánchez and Noguera-Gámez 2017)
Part E
Information was gathered from the CPA report and it can be seen that most of the arguments took place by the stakeholders and they were talking about the usefulness of integrated reports as it help at the time of making the comparison of the reports. Here, comparability is done between two or more companies within a given industry or sector as well as it plays major role for the environmental stakeholders.
Information was gathered from the integrated reports and it can be seen that both consistency and comparability involves allowing for making the comparisons for specified time frame. In addition to that, use of integrated reports will help in presenting the reports with internal consistency and measures taken for given period of time and this can be done by comparing with other companies.
4.Part A
|
Explaining the objectives of International Framework |
Explaining the objective of General Purpose Financial Reporting as mentioned in the Australian Accounting Standard Board conceptual framework |
|
Meaning International Framework is one of the integrated reports that guide in rendering concise information on matters relating to strategy, context prospects and governance that leads to creation of values for specified time frame (Tweedie, Nielsen and Martinov-Bennie 2017) |
Meaning Help at the time of describing the objectives and concepts as mentioned in the general purpose financial reporting. One of the practical tool that guides International Accounting Standards Board for developing the Standards that need to be consistent by nature. |
|
Objectives To help in governing the general content of the integrated reporting and enlighten the underlying concepts (Lodhia and Stone 2017) |
Objectives To understand and interpret the standards To develop consistent accounting policies where no Standard is applicable to specific transaction or events where no Standard permits selection of the accounting policy. |
Part B
|
Highlighting the users of an integrated report |
Highlighting the users of general purpose financial reporting |
|
On using integrated report, it guides all stakeholders who actually shows interest in any business and involve in understanding the ability for creation of value for give period of time and the stakeholder for this concern are customers, employees, business partners, policy makers, legislators and regulators (Thomson 2015) |
Long-term investors are the users of general purpose financial reporting It can be seen that most of the investors do not get access to information and this is the reason why there is needed to get access to financial information from general purpose financial reports (Stubbs and Higgins 2014). |
Part C
|
Materiality concept as mention in the integrated reports |
Materiality concept as mentioned in the IASB conceptual framework |
|
In case of integrated reports, the reports properly discloses the information regarding materiality concept as it greatly help in value creation activities. |
Materiality can be treated as entity specific aspect of relevance as it is based upon magnitude as well as links by understanding the concept of financial reporting of individual entity. In that case, IASB Board fails to mention about uniform quantitative threshold that explain about the materiality concept. |
Part D
|
Explaining concept such as reliability, completeness, consistency and comparability as mentioned in the integrated reports |
Explaining concept such as reliability, completeness, consistency and comparability as mentioned in the IASB conceptual framework |
|
Reliability It is essential to provide reliable information that is free of any material misstated figures or material error in that case. This can be done by conducting robust internal control and reporting system and engaging stakeholders (Sierra?García, Zorio?Grima and García?Benau 2015 Completeness All the informational needs should be identified and links with the industry as it is likely to be material that concerns all business and industries at the same time Consistency It is essential to follow the reporting policies reliably for given one period until there is any change as it is required for bringing enhancement in the quality of reported information Comparability Information widely varied from one business to other in integrated report because each business unit desire to create value in their own unique way. |
Reliability Information provided should be reliable as mentioned in the IASB conceptual framework. Reliability can be treated as qualitative characteristics that help in providing useful reliable information Completeness Completeness is one of the elements of faithful representation. The information provided to the users should be complete and there should not be any missing information Consistency With the reporting entity, making use of the same methods by considering the same items Comparability Comparability is a goal and treated as qualitative characteristics as it guide users in identifying and understanding the similarities and differences among different financial reports (Simnett and Huggins 2015). |
5.IR Guiding Principles
Stakeholder relationships
|
Stakeholder relationships In the integrated reporting, it is mentioned about stakeholder relationships and this takes into account improved corporate reputation and stakeholder relationships. |
|||
|
HULAMIN LTD |
CEMEX |
MTN Group |
DSM |
|
HULAMIN LTD engages in subscribing to the principles on stakeholder management as mentioned in the King III Code. Here, the management of this company had engaged in highlighting the strategy and formulating the policies for maintaining relationship with each of the grouping of stakeholders. Furthermore, the company engages in solving any disputes that takes place with the stakeholders (Hulamin Ltd 2018). Therefore, the company give first preference to the stakeholders and try to resolve the disputes rather than litigating and making use of alternative disputes resolution mechanism as and when required. |
CEMEX believes in maintaining positive relationships with the stakeholders and they even inform all the information to them so that there is miscommunication that takes place (Cemex. 2018). |
MTN Group informs their stakeholders on matters relating to any operations as the money of the stakeholders are invested within the business (MTN Group 2018) |
DSM believes in informing their stakeholders as it help in maintaining cordial relationships. Strong relationships should be maintained by the stakeholders as it help while undertaking decision-making activities (DSM 2018) |
Materiality
|
Materiality In the integrated reports, it is properly mentioned about the materiality concept that help in determining and applying from the perspectives of value creation activities |
|||
|
HULAMIN LTD |
CEMEX |
MTN Group |
DSM |
|
The concept of materiality as understood by the company had been brought forward in the disclosures both in qualitative and quantitative way. Several changes can be noted in the content that brings together enhancement of information and involving in creation of specific comparative figures as it result in keeping a note of information for reference purpose (Hulamin Ltd 2018). |
The concept of materiality as understood by the company had been ton provide information relating to all material matters where there will be missing or in that case misstated figures shown in the financial statement of the company (Cemex. 2018) |
The concept of materiality as understood by the company had been highlighted in the financial statement where all the material matters are given (MTN Group 2018). All the information regarding the material matters will help the users of financial reporting to get access to overall information on understanding the financial information of the company for specified time frame. |
The concept of materiality as understood by the company had been to inform the users about material matters and clearly mentioned in the financial statement (DSM 2018). |
Consistency and comparability
|
Consistency and comparability In the integrated reporting, comparability and comparability means allowing for undertaking comparisons to be made for specified time with other business enterprises.
|
|||
|
HULAMIN LTD |
CEMEX |
MTN Group |
DSM |
|
The concept of consistency and comparability as understood by the company is to adopt consistent approach as it help in balancing in treatment in and among the categories of stakeholders (Hulamin Ltd 2018). HULAMIN LTD aims at separating sustainability reports of the group as it is required to be assessed with level of consistency in rendering consistent information that should be properly informed to the Committee Members. In this case, the company aims at comparing the information by determining certain comparative figures and should be restated in the most appropriate way. |
Providing consistent information to the users and the information need to be compared with other business entities (Cemex. 2018) |
Focus upon understanding the two qualitative characteristics (consistency and comparability) and help their users in rendering consistent information and involve in comparing with other business entities (MTN Group 2018) |
Providing consistent information to the users as well as the gathered information need to be compared with other business entities (DSM 2018) |
Reliability and completeness
|
Reliability and completeness Balancing good and bad news together |
|||
|
HULAMIN LTD |
CEMEX |
MTN Group |
DSM |
|
Engages in providing reliable information to their users and make sure that the provided information need to be completed with no material misstated figures or any missing information (Hulamin Ltd 2018) |
Providing reliable and complete information to the users (Cemex. 2018) |
Providing reliable and complete information to the users (MTN Group 2018) |
Providing reliable and complete information to the users (DSM 2018) |
6.In this question, factors will be discussed that explain the similarities and differences as identified in the previous question. It can be seen from the above question on how far the IR guiding principles are essential in evaluating the undertaking as and when undertaken by any business enterprise. In the above question, four guiding principles were selected and explained for conducting analysis and these principles are stakeholder relationships, reliability and completeness, materiality and consistency and comparability. All of these four guiding principles were explained in details by referring to four companies and these companies are HULAMIN LTD, MTN Group, CEMEX and DSM. As far as integrated report are concerned for these four companies, it is needed to be related with the IR guiding principles.
After explaining about the similarities and differences, several factors had been identified and this is information gathering. This means getting access to accurate and complete information is essential and can be considered as one of the factors pertaining to integrated reporting framework. It becomes quite impossible for any companies to attract stakeholders and engage in maintaining relationships with them if there is incomplete or lack of information gathered or provided. Each of the stakeholders has the right to get informed on matters relating to any changes that had been developed within the business enterprise. Image of the company can be hampered if the company engages in hiding of any of the information or involve in material misstatement of figures because this activities distort the actual information. There are several other key factors and these are communication with the stakeholders and maintain positive relationships in the most appropriate way.
Conclusion
From the above analysis, it is found out that integrating reporting renders information to their users in an effective way. In addition to that, this integrated reporting help in carrying out the business by taking into account mainstream business practices as well as connecting it with the other industries and business companies at the same time. At the time of making the comparison, it becomes essential to understand the fact as each of the company have to provide complete information in their financial statement. By doing that, it will help the users while they involve in decision-making activities. Therefore, communication with the stakeholders and maintaining relationships with them becomes important in the long-term process.
References and Bibliography
Adams, S. and Simnett, R. 2011, Integrated Reporting: An Opportunity for Australia’s Not-for-Profit Sector. Australian Accounting Review, 21: 292–301. doi:10.1111/j.1835-2561.2011.00143.x
Brown, J. and Dillard, J. 2014 “Integrated reporting: On the need for broadening out and opening up”, Accounting, Auditing & Accountability Journal, Vol. 27 Issue: 7, pp.1120-1156, https://doi-org.wallaby.vu.edu.au:4433/10.1108/AAAJ-04-2013-1313
Busco, C.A., 2016. Integrated Reporting. Springer,.
Cemex. 2018. Examples.integratedreporting.org. [online] Available at: https://examples.integratedreporting.org/organisation/451 [Accessed 25 Apr. 2018].
Cheng, M., Green, W., Conradie, P., Konishi, N. and Romi, A., 2014. The international integrated reporting framework: key issues and future research opportunities. Journal of International Financial Management & Accounting, 25(1), pp.90-119.
Cpaaustralia.com.au. 2018. Integrated reporting. [online] Available at: https://www.cpaaustralia.com.au/professional-resources/esg/integrated-reporting [Accessed 25 Apr. 2018].
de Villiers, C., Rinaldi, L. and Unerman, J., 2014. Integrated Reporting: Insights, gaps and an agenda for future research. Accounting, Auditing & Accountability Journal, 27(7), pp.1042-1067.
DSM 2018. Examples.integratedreporting.org. . [online] Available at: https://examples.integratedreporting.org/organisation/320 [Accessed 25 Apr. 2018].
Dumay, J., Bernardi, C., Guthrie, J. and Demartini, P., 2016, September. Integrated reporting: a structured literature review. In Accounting Forum (Vol. 40, No. 3, pp. 166-185). Elsevier.
Flower, J., 2015. The international integrated reporting council: a story of failure. Critical Perspectives on Accounting, 27, pp.1-17.
García-Sánchez, I.-M. and Noguera-Gámez, L. (2017), Institutional Investor Protection Pressures versus Firm Incentives in the Disclosure of Integrated Reporting. Australian Accounting Review. doi:10.1111/auar.12172
Hulamin Ltd 2018. Examples.integratedreporting.org. . [online] Available at: https://examples.integratedreporting.org/organisation/154 [Accessed 25 Apr. 2018].
Integratedreporting.org. (2018). Integrated Reporting. [online] Available at: https://integratedreporting.org/ [Accessed 25 Apr. 2018].
Lodhia, S. and Stone, G. (2017), Integrated Reporting in an Internet and Social Media Communication Environment: Conceptual Insights. Australian Accounting Review, 27: 17–33. doi:10.1111/auar.12143
MTN Group 2018. Examples.integratedreporting.org. . [online] Available at: https://examples.integratedreporting.org/organisation/143 [Accessed 25 Apr. 2018].
Sierra?García, L., Zorio?Grima, A. and García?Benau, M.A., 2015. Stakeholder engagement, corporate social responsibility and integrated reporting: an exploratory study. Corporate Social Responsibility and Environmental Management, 22(5), pp.286-304.
Simnett, R. and Huggins, A.L., 2015. Integrated reporting and assurance: where can research add value?. Sustainability Accounting, Management and Policy Journal, 6(1), pp.29-53.
Stubbs, W. and Higgins, C. 2014 “Integrated Reporting and internal mechanisms of change”, Accounting, Auditing & Accountability Journal, Vol. 27 Issue: 7,pp.1068-1089, https://doi-org.wallaby.vu.edu.au:4433/10.1108/AAAJ-03-2013-1279
Thomson, I., 2015. ‘But does sustainability need capitalism or an integrated report’a commentary on ‘The International Integrated Reporting Council: A story of failure’by Flower, J. Critical Perspectives on Accounting, 27, pp.18-22.
Tweedie, D., Nielsen, C. and Martinov-Bennie, N. (2017), The Business Model in Integrated Reporting: Evaluating Concept and Application. Australian Accounting Review. doi:10.1111/auar.12196
Essay Writing Service Features
Our Experience
No matter how complex your assignment is, we can find the right professional for your specific task. Contact Essay is an essay writing company that hires only the smartest minds to help you with your projects. Our expertise allows us to provide students with high-quality academic writing, editing & proofreading services.
Free Features
Free revision policy
$10Free bibliography & reference
$8Free title page
$8Free formatting
$8How Our Essay Writing Service Works
First, you will need to complete an order form. It's not difficult but, in case there is anything you find not to be clear, you may always call us so that we can guide you through it. On the order form, you will need to include some basic information concerning your order: subject, topic, number of pages, etc. We also encourage our clients to upload any relevant information or sources that will help.
Complete the order form
Once we have all the information and instructions that we need, we select the most suitable writer for your assignment. While everything seems to be clear, the writer, who has complete knowledge of the subject, may need clarification from you. It is at that point that you would receive a call or email from us.
Writer’s assignment
As soon as the writer has finished, it will be delivered both to the website and to your email address so that you will not miss it. If your deadline is close at hand, we will place a call to you to make sure that you receive the paper on time.
Completing the order and download