A reporting framework is followed for integrated reporting which make organizations take an extended period and essential decisions concerning both financial and other corporate areas. Before the development of the integrated system, businesses used to use traditional financial reporting system which was time consuming and complicated as well. Along with this, traditional reporting system was based on the presentation of the economic data. But now, the integrated data system not only works for the financial decisions but also consists of the data from the various fields including the external environment. Integrated reporting involves thinking about the value beyond the financial terms and helps in building a healthy relationship with the stakeholders and customers (Kerzner & Kerzner, 2017). The present file is based on the impact of the integrated reporting on the financial reporting system. In context to this, the study includes a problem statement, the background of the project and research aim and objectives. Along with this, the research also consists of the conceptual framework and research methodology for accomplishing the desired goals.
Background of the project:
Integrated Reporting (IR) refers to the process which includes communication in the form of a periodic integrated report with respect to the value creation over the time. It helps in providing information about how the strategy of a firm, governance, performance, and approaches result to create value over the short, medium and extended period. Along with this, IR helps companies in completing their financial and sustainability reports effectively. IR pays attention to the long term strategy and mixed reports for developing the effective plan for improving the financial performance of the organisations (Fleming & Koppelman, 2016). The framework of IR involves that the success for a long period depends upon the sound management, stable relationships, high and satisfied work performances and availability of the resources. The information provided by the companies to their investors does not include all the necessary details in their annual review or financial statement. This gap is filled by the integrated reports and allows businesses to tell providers about the capital and others which help in developing value for them. This also increases the ability of the management for responding effectively to the changing needs of the stakeholders concerning financial progress and social responsibility. The impact of integrated reporting is practical on the financial system of the firms as it has improved the work performances. Businesses are disclosing both financial and non-financial performance for becoming more accountable and transparent to the providers of the capital and IR helps them in meeting the gap and providing all the necessary information effectively (Schwalbe, 2015).
Problem Statement
Integrated reporting is a new method which is used by the companies for creating an adequate financial reporting system. For most of the people, integrated reporting is one of the appropriate choices as it contains all the information about the company, its strategy, approaches, achievements, objectives, corporate social responsibility, financial performance and many more. Thus, IR is not only limited to the financial field of the organizations. But according to some of the accounting specialists, integrated reporting is a lengthy and time consuming method which leads to wastage of time, money and cost. This represents IR as a failure for the financial reporting system (Walker, 2015).
Along with this, researchers are criticizing the integrated reporting due to the need for proper accounting knowledge and skills for handling it. The use of integrated reporting system for the financial reporting system needs much more than understanding and information. It is a challenge for the employees to prepare a financial report by using IR as it is a complicated and time consuming method which leads to demotivate workers and decreases their performance. Integrated reporting is one of the emerging areas of the study with respect to the financial performance. Hence, it is essential to research the cited area with the help of review of literature which leads to analyze the gap in the field of IR with respect to the financial reporting system. As per the various studies, it is problematic to develop the direct relation between the integrated reporting and financial reporting system. Thus, the purpose of the present study is to fill the gap by identifying the impact of integrated reporting on the financial reporting system. In context to this, integrated reporting of the companies like Apple and Coles is investigated. Practical methods and appropriate approaches help the researcher in knowing the impact and its effectiveness for the growth and development of a company (Kerzner, 2018).
The aim of the Research:
The aim of the present research is as follows:
Objectives of the research
The goals of the present study are as follows:
Questions of the Research:
The research questions for the existing file are explained below:
Integrated reporting and its influence on the financial aspect is grabbing the attention of the companies as it helps in better report formation. Therefore, investigation on the impact of integrated reporting on the financial reporting system is a primary area of concern for the organizations. This study is vital as it helps companies in discovering the effects of the integrated reporting on the financial reporting system. Thus, sufficient information and knowledge about the role of integrated reporting on the financial performance of the companies like Apple and Coles will help in improving the functioning of the other firms and make them gain competitive advantages (Calvo-Mora, Navarro-García & Periañez-Cristobal, 2015). The results of the cited research can help companies to improve their financial performance by understanding both negative and positive influence of the integrated reporting. Different aspects of this investigation will help firms in strengthen their areas and improving their weaknesses for growth and development. Useful literature of the present study will make organizations decide whether to implement integrated reporting in their working environment or not. Proper analysis and evaluation of the information help scholar in accomplishing the objectives of the study (Mir & Pinnington, 2014). The research may lead to providing various solutions for the problems of the companies:
Therefore, the result of the present investigation will not only inform about the integrated reporting of the Apple and Coles but also help other companies in taking appropriate decisions concerning their growth and development in the today’s highly competitive market.
The predictable results of the present investigation which can be gained at the end of the research project are described below:
Result 1:
An effective and vital conceptual framework will be created which will help in better understanding of the impact of integrated reporting on the financial reporting system.
Result 2:
The impact of the integrated reporting on the financial reporting system of the companies will be analyzed
Result 3:
The result of this research will help scholars in conducting further investigation or understanding the concept as it will address the problem and support businesses in the financial areas.
Result 4:
The investigation will help companies in improving their decision making process and maintaining investors and customers for better understanding.
Conceptual Frameworks
This section explains the variables used for generating the conceptual framework. With respect to the present research, it is as follows:
Integrated Reporting
According to the Hornstein, (2015), “Integrated reporting includes communication with the help of integrated report which helps in creating value over time.” This integrated report shows the performance of a company in both financial and non-financial terms. Similarly Svejvig & Andersen, (2015), have demonstrated that “Integrated reporting includes the greater context of the data which explains how a firm can use it effectively for creating value into the operations and long term decision making processes.” IR leads to provide benefits to the stakeholders by helping them in taking decisions regarding the financial allocation of the capital.
Joslin & Müller, (2015), have stated that “Companies are adding environmental, social and governance information in their reports along with the financial growth which is providing them significant benefits.” Organizations like Apple and Coles are including information about their corporate social responsibility, environmental contribution, etc. for increasing the interest of the investors and customers within them. Along with this Todorovi? and et.al., (2015), have said that “In the present time, financial accounting standards are outdated, integrated reporting is taking place”. A few corporate pioneers like Apple and Coles are experimenting with the integrated reporting by involving the sustainability information and metrics in their annual financial reports.
The contribution of Integrated Reporting in helping investors and customers
Newton, Greenberg & See, (2017), have found that “The main purpose of the integrated reporting is to enable stakeholders to assess the ability of a company for creating and sustaining the value for short, medium or long period”. With respect to this, the IR helps investors and customers of the organizations in collecting all non-financial and financial information and understanding the actual situation. However, IR is not beneficial for the shareholders, but stakeholders like employees, customers, suppliers, investors, etc. can get advantages of it.
Apart from this Too & Weaver, (2014), have identified that “The stakeholder theory can understand the contribution of IR in the value creation of a firm”. With respect to this, the theory includes two ideas: firstly, the theory does businesses to accomplish good performance by assisting mangers in identifying the purpose and objectives. Secondly, the theory makes manager develop relation as they want to create with the stakeholders within their environment for fulfilling the purpose of their organization. Along with this Riol & Thuillier, (2015) have found that “The purpose of the financial report is to provide information to the financial capital provider, but the objective of IR is proposed for the multiple parts of capital providers.” Thus, companies and their manager need to consider the interest area of all the groups.
Impact of integrated reporting on financial reporting system:
The effect of the IR of the financial reporting system is as follows:
Convey firm’s strategic focus: According to the Sánchez, (2015), “Integrated reporting provides all the information regarding the human resources, social contribution, financial performance, environmental influences, etc. which represents the strategic view of the company.” Stakeholders of the firm can easily understand its objectives, vision, and mission with the help of IR.
Connecting all areas across all type of risks: As per the view of de Carvalho, Patah & de Souza Bido, (2015), “Complete picture of the challenges faced by firms, achievements gain, failures, etc. represent the actual image and provides real information to the investors or other stakeholders”. By collecting all the information and gaining the real picture, organizations can able to make effective decisions for reducing risk and improving their present situation by building more sustainable long-term future.
Concise, reliable and material information: Integrated reporting includes original and brief information about the company growth which has given a new direction to the financial reporting system. Concise information about each sector including financial helps in taking right decisions for further expansion and development of the businesses (Marcelino-Sádaba, González-Jaen & Pérez-Ezcurdia, 2015).
Research Methodology
The process including a set of methods which are used by the scholar for accomplishing the desired objectives of the research is known as a research methodology. Suitable methods and appropriate approaches help the author in finding answers to the research questions. In context to this, exploratory research design will be used by the scholar for completing the current study and achieving the goals and objectives. As the researcher is using secondary data collection method, so, exploratory research design is the right choice for this research. There are other research design methods as well as meta-analytic, descriptive, etc. but these are related to the primary data collection method which is not used in this investigation (Marcelino-Sádaba and et.al., 2014). For the current survey, research methodology is as follows:
Literature Review:
This area includes information concerning the subject of the study for providing a better understanding of the issue. With respect to this, different sources are used by the author like books, business magazines, articles, newspapers, websites and many more for gathering the relevant information. In context to the present study, scholar selects books, articles, previous journals, websites and annual reports of the firms for understanding integrated reporting and its impact on the financial reporting system Literature review will help in evaluating the information effectively concerning the current investigation (Golini, Kalchschmidt & Landoni, 2015).
The process of collecting information with the different sources is called as data collection. There are two types of data collection methods: Primary data collection and secondary data collection. Primary data collection method is used for collecting real information with the help of different instruments like observation, face to face interviews, questionnaire and many more. On the other hand, secondary data collection method is used for gathering information from the existing researches. The sources used for collecting the secondary information consists of books, magazines, annual reports and many more (Kucharska & Kowalczyk, 2016).
With respect to the present study, the researcher will use secondary data collection method. In this, the scholar will collect secondary information with the help of books, previous researches, journals, articles, websites and annual reports of the companies. This will help the author in accomplishing the objectives of the current investigation in an effective manner (Eskerod, Huemann & Savage, 2015).
The process of examining, converting and modeling the data for collecting the meaningful information, supporting the decision making and achieving the desired objectives is called as data analysis. There are two types of data analysis methods: qualitative and quantitative methods. The primary purpose of data analysis method is to evaluate and meaningful and relevant information for developing effective decision with respect to the investigation. In context to the present study, the scholar is using only secondary data collection methods, and for this, quantitative data analysis method is a most suitable method, With the help of systematic approach, the investigator will be able to examine and transform the collecting data effectively (Conforto and et.al., 2014).
Organization of the Study
This section includes the way in which researcher will organize the entire study effectively. Firstly, the research proposal will create by the investigator with respect to the topic. Secondly, all the relevant information will be gathered via the conceptual framework, and set of methods will be selected in research methodology. Thirdly, collected data will be analyzed, and in the end, findings will be obtained by the scholar (Boyle, 2017). In context to this, the current investigation will be organized by the scholar in the following manner:
Chapter One: This chapter will consist of the research proposal which is explained in the assignment
Chapter Two: This section will describe and analyze the impact of the integrated reporting on the financial reporting system
Chapter Three: This section of the investigation will include research methodology which will consist of literature review, data collection method and data analysis of the collected information.
Chapter Four: This section will explain the whole data analysis process and include the Gantt Chart along with the estimated budget of the research.
Chapter Five: This will be the last section of the investigation which will include a conclusion, a summary of the findings and discussion about their implications on the financial reporting system of the companies.
Gantt chart
Gantt Chart for the present investigation is as follows:
|
Activities |
Starting Date |
Ending Date |
No. of days |
|
Identification of the research problem |
15/06/18 |
25/06/18 |
Ten days |
|
Formation of the aims and objectives |
27/06/18 |
1/07/18 |
Five days |
|
Development of Project Proposal |
2/07/18 |
12/07/18 |
Ten days |
|
Literature Review for collecting secondary information |
13/07/18 |
25/07/18 |
13 days |
|
Research Methodology |
26/07/18 |
5/08/18 |
Ten days |
|
Collection of Data |
6/08/18 |
30/08/18 |
25 days |
|
Analysis of the data |
31/08/18 |
15/09/18 |
16 days |
|
Submission |
16/09/18 |
30/09/18 |
15 days |
Thus, from the above chart, it is clear that research will take four months and 104 days to complete appropriately by following all the eight segments of the process activities.
Project Budget and Budget Justification
The estimated total budget for this project is $4500 which will be completed within the time frame from 15/06/18 to 30/09/18.
Project Budget for the present investigation is as follows:
|
Budget Areas |
Estimated Budget |
|
Data Collection |
$2000 |
|
Literature review |
$1500 |
|
Data Analysis |
$1000 |
|
Total Estimated Budget |
$4500 |
Conclusion
From the above study, it is concluded that researcher will use effective methods for analyzing the impact of the integrated reporting on the financial reporting system. Secondary collection method will help scholar in collecting the relevant information with respect to the subject. Along with this, the project needs to complete in the decided period (15/06/18 to 30/09/18) and within the estimated budge of $4500.
References
Boyle, G. (2017). Design project management. Routledge.
Calvo-Mora, A., Navarro-García, A., & Periañez-Cristobal, R. (2015). Project to improve knowledge management and key business results through the EFQM excellence model. International Journal of Project Management, 33(8), 1638-1651.
Conforto, E. C., Salum, F., Amaral, D. C., da Silva, S. L., & de Almeida, L. F. M. (2014). Can agile project management be adopted by industries other than software development?. Project Management Journal, 45(3), 21-34.
de Carvalho, M. M., Patah, L. A., & de Souza Bido, D. (2015). Project management and its effects on project success: Cross-country and cross-industry comparisons. International Journal of Project Management, 33(7), 1509-1522.
Eskerod, P., Huemann, M., & Savage, G. (2015). Project stakeholder management—past and present. Project Management Journal, 46(6), 6-14.
Fleming, Q. W., & Koppelman, J. M. (2016, December). Earned value project management. Project Management Institute.
Golini, R., Kalchschmidt, M., & Landoni, P. (2015). Adoption of project management practices: The impact on international development projects of non-governmental organizations. International Journal of Project Management, 33(3), 650-663.
Hornstein, H. A. (2015). The integration of project management and organizational change management is now a necessity. International Journal of Project Management, 33(2), 291-298.
Joslin, R., & Müller, R. (2015). Relationships between a project management methodology and project success in different project governance contexts. International Journal of Project Management, 33(6), 1377-1392.
Kerzner, H. (2018). Project management best practices: Achieving global excellence. John Wiley & Sons.
Kerzner, H., & Kerzner, H. R. (2017). Project management: a systems approach to planning, scheduling, and controlling. John Wiley & Sons.
Kucharska, W., & Kowalczyk, R. (2016). Trust, Collaborative Culture and Tacit Knowledge Sharing in Project Management–a Relationship Model.
Marcelino-Sádaba, S., González-Jaen, L. F., & Pérez-Ezcurdia, A. (2015). Using project management as a way to sustainability. From a comprehensive review to a framework definition. Journal of cleaner production, 99, 1-16.
Marcelino-Sádaba, S., Pérez-Ezcurdia, A., Lazcano, A. M. E., & Villanueva, P. (2014). Project risk management methodology for small firms. International journal of project management, 32(2), 327-340.
Martinsuo, M., & Hoverfält, P. (2018). Change program management: Toward a capability for managing value-oriented, integrated multi-project change in its context. International Journal of Project Management, 36(1), 134-146.
Mir, F. A., & Pinnington, A. H. (2014). Exploring the value of project management: linking project management performance and project success. International journal of project management, 32(2), 202-217.
Newton, V., Greenberg, A., & See, J. (2017, July). Project Management Implications and Implementation Roadmap of Human Readiness Levels. In International Conference on HCI in Business, Government, and Organizations (pp. 99-111). Springer, Cham.
Riol, H., & Thuillier, D. (2015). Project management for academic research projects: balancing structure and flexibility. International Journal of Project Organisation and Management, 7(3), 251-269.
Sánchez, M. A. (2015). Integrating sustainability issues into project management. Journal of Cleaner Production, 96, 319-330.
Schwalbe, K. (2015). Information technology project management. Cengage Learning.
Svejvig, P., & Andersen, P. (2015). Rethinking project management: A structured literature review with a critical look at the brave new world. International Journal of Project Management, 33(2), 278-290.
Todorovi?, M. L., Petrovi?, D. ?., Mihi?, M. M., Obradovi?, V. L., & Bushuyev, S. D. (2015). Project success analysis framework: A knowledge-based approach in project management. International Journal of Project Management, 33(4), 772-783.
Too, E. G., & Weaver, P. (2014). The management of project management: A conceptual framework for project governance. International Journal of Project Management, 32(8), 1382-1394.
Walker, A. (2015). Project management in construction. John Wiley & Sons.
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