From all the theories which are used in the social and environmental accounting is known as the legitimacy theory. It is the most relevant theory in the accounting process of any company. Various definitions of legitimacy theory are discussed by Suchman which are known as the most significant. The un-natural financial state of the country can be recovered by the application of the legitimacy theory. The social and political issues can be ignored by the application of the legitimacy theory. The society can be able to achieve the financial scope and the development of the communication and the international market also can be achieved by the company with the application of the legitimacy theory in their business finance (Appannaiah, Reddy and Putty, 2010). The social studies theories can be able to define the internet financial reporting by utilizing the legitimacy theory through which the company can be able to get the correct information about the financial and the non-financial annual reports. The present and modern movement of the government is governed by the social contract of the legitimacy theory. The government should know about the legality of them. In the present situation, both the utilization of the social contract and the legitimacy theory is most relevant.
The internet financial reporting has been researched by many authors, but they become unable to find out the relevancy and the positive association between the internet financial reporting and the legitimacy theory. According to the annual accounts, the oil, chemical and the mining can be more profitable for the company. The data delivered by the legitimacy theory depend on the separation of the diverse sectors (Belding, 2008). With the modification of the work process and the application of the legitimacy theory, the companies become more ecological than other industries. The more ecological discovery is shown by the companies through the application of the legitimacy hypothesis. The application of the legitimacy theory can provide better internet financial reporting than the other process. It also has an environmental impact to the shareholders which are also measured by the analysis of the applied legitimacy theory to the company. By the application of the legitimacy theory, the large company becomes able to get more profits, and it has an effect on their annual financial report. The social and the environmental agreements are not fully depends on the legitimacy theory (Britton and Waterston, 2013). The human rights related to this theory can be confined by the state, central or local court. The government, community, shareholder all is being affected by the application of the social contract of the legitimacy theory. To get more efficient and additional resource, the companies should realize to apply the legitimacy hypothesis in their business. The size and the connection between the IFR are also depended on the application of the legitimacy theory. The company’s financial report and all the information are disclosed by the alternatives theories which are available in the company accounts. The size, ownership, leverage of the company is driven by the annual result of the company which also helps in the preparation and presentation of the annual report. According to the various analyses report of the legitimacy theory, the government and the individual agreements shows the human rights to protect their ethics and the culture from the obligations (Critical theory, 2011). The decision of the shareholders is also pressurized by the high level of productivity which is also governed by the IFR. The IFR used to attract the maximum shareholder and the customers also. The researchers over social and environmental contract were done by the Hopwood which was entirely based on the legitimacy theory. It helped to prepare and presentation of the annual financial report of the firm. There was a solid relationship between the social and environmental contract with the theory of legitimacy in the study of accounting. This is also first invented by Hopwood. The study of the social and the environmental commitment is deeply related to the legitimacy theory which is related to the accounting and business financial reporting. The companies get the motivations about the social and the environmental contract is supplied by the legitimacy theory. The legitimacy theories are adopted by the companies when they are facing the challenges from the shareholder; then this legitimacy theory helps to overcome the situation. The incensement of the environmental degradations is described by the application of the legitimacy theory. The social contract report and the environmental report behavior are governed by the legitimacy theory applied to the companies. The application of the legitimacy theory facilitates the financial report of the private companies and the government as well (Glautier, Underdown and Morris, 2011). The society can be able to achieve the financial span and the development of the statement and the global market also can be accomplished by the company with the purpose of the legitimacy theory in their industry finance. The high level of influence is given by the IFR to the firm to continue their services and provides more relevant evidence of financial report. The disclosure of the IFR and the leverage are negatively connected. The shareholders are responsible for representing and controlling the interest of the manager. The less presence of the stakeholder denotes the less usage of the internet financial report. The financial coverage governs the increase of the cleanliness of the financial reports. The substantial financial decisions and the fair reports are prepared by the utilization of the legitimacy hypothesis which also governs the investment of the shareholders and the demands of the customers. The corporate social responsibility provides the great emphasis on the whole contemporary company organizations (Horngren, 2014). The sustainability of the company organizations helps in improving the strategies of the viability of the environment and the surrounding society where the company operates their business. Hence, the entire business association put the great importance on the corporate social responsibility. These have a considerable impact on the company association. As well as spoil the sustainability quotient of the industry organization and these factors hinder the progress of the company association. There are various evident that social environmental plus issues within the company association emerging an inclusive of gender intolerance in that individual workplace. Extensive uses global warming, child labor, deforestation, thinning of ozone layers, waste disposal, environmental pollution, species extinction etc. The corporate social responsibility approach the support of industry organization to avoids the legal hazards and the associated factors that can obstruct the growth and expansion of the industry organizations (Horngren, 2013). It also explains the management feelings which are managed by the affecting the character and also the effect can be simply judged. The sustainability of the community is also increased with the efficient corporate social responsibility that strategies of the business organization as it increases the employments opportunities so reduces poverty, hungry or other social issues. With the help of the effective corporate social responsibility of the business organization policy that can deduct the environmental and social impact. Improves the organizational sustainability in the sense of long run, which is important for the sustainable society as well as to improve the environmental sustainability. It is very much significant for the individual companies to expand and implement the right corporate social responsibility approach that support the expansion and the development of the business association as well as the society which is increasingly developed and growing (Kew and Watson, 2012). Financial condition can be deducting the corporate social responsibility approaching that implemented by the individual business association. The planning of the company organizations are the generally substantial job opportunities for the individual workers in the corporate social responsibility. On the other hand the individual income opportunities for the every people of surrounding environment that helps in the boosting the financial or economy situation of the society, which provide the economic stability to the individual society. For the protection with the rules and implementations of regulations in the case was not complying in the environment by the industry organizations. It can impede the business association which faces the most important legal factors of the increase in the growth and development of the industry association. It is also an important issue of the environmental sustainability of the business organization as well as the government. In this matter, to meet the business organization, the government has introduced many rules and regulations in this company operate in an individual region (Krivogorsky, 2012). As a result invites of several dreadful diseases to the individual society that affected the people very much. Besides this, the impacts of environment provide a disturbing effect on the society which causes the damage on the each balance of the ecosystem of the surrounding environment. Similarly, these factors have affected the people of the community also in the same cases. In the long sense it means the individual industry of the organization is also affected in the society of the organization which is also largely dependent on the society of the people. On the industry organization put the great pressure to lead the several variety of business association to reflect on their specific corporate social and environmental responsibilities. A mixture of increasing social awareness of the individual factors that related to the society and the environmental of the ordinary people to increment under the non-government associations (Libby, Libby and Short, 2014). Therefore, the effective environmental policy is one of the most significant aspects of the big business organizations. The social accounting play very important role, as well as the accountants, it also contributed significantly to the social order by delivering a true and fair vision of the business location of the organization. Reporting the environmental and social this is mainly associated the individual provisions. Information on the performance of a company association with respect to its interactions with the social environment, including the information of personal support of workers, safety records as well as usages of the natural resources. This specially heightened the anxiety among the people of the civilization over the ill effects of the business operations of the physical plus social environment. It has restricted in the social plus environmental reporting of the business organization. In both the sustainability and the financial performances along with the ecological sustainability in the latter encompasses of the individual company association. Extensive uses global warming, child labor, deforestation, thinning of ozone layers, waste disposal, environmental pollution, species extinction etc. The social report is hence vital for the business organization, and often the social story of the business organization is called corporate social responsibility reporting (Monger, 2010). The social contract theory provides considerable ideas to recognize the social reporting as well as help in assessing the relation between the accountants with the society. Hence, the social contract describes the limitations of communication approved by the societies of the numbers. The corporate social contract can be depicted as the communications between the entities or the person within the individual society to explicit the boundaries of the behaviour. The primary function of all these types of industry organizations from the viewpoint of society is to progress social welfare via satisfying customers as well as employees’ concentration along with the interest of the shareholder and shareholders of the business association. According to the social contract where the productive firms are moral subject assessments that exceed the limitations of the political infrastructure that adjoin them. At the time of the business, organizations become ineffective to live up to these specific expectations the teams are right for moral criticism by the evaluation (Murthy, 2009). At the same time, the individual business association are remaining with the boundaries of justice. Therefore, the social agreement with the stakeholders within a society, it is predictable to act only those activities that are attractive plus useful to the entire community instead of only the depositor. For these, the administration reacts positively to the environmental social plus factors as an individual organization. It has ethical responsibilities to the different society to performing these activities towards the society that may affect the result in the application of the dictatorial needs to manage the presentation of administration on employees and environment. The situation or the status can be easily resolute by showing the subsistence of the entity’s values when the value is in attendance in the congruence circumstances. As per the legitimacy theory, it is being concerned with the structure that represented the appropriate explanation of the application and relevance of the social contracts in the individual accounting. It is being identified the continuation of the actual or the probable disparity. It is being indicated as the threat to the legitimacy circumstances in the original formation which is being illustrated the social in the two value systems (Monger, 2011). This directly determines the suitable extracts which are made by the demonstration of the information attempts. It is characterize by showing the information disclosures as demonstrate by the communal legitimacy. As well as spoil the sustainability quotient of the industry organization and these factors hinder the progress of the company association. For ensuring the activities which are a part of vital significance are represented by the respective societies which are provided in the form of the attempt. The theory declared the organizational ensuring which is being obtainable in the shape of the operations made within the boundaries and also the norms. Therefore, the arrangement can be well recognized by undertaking the social activities and also the prospect of the society can be made create the various forms of the subject. It can be easily represented the appropriate structure by showing the right explanation of the work which is shown the improvement of the working which is illustrated the fulfillment of the individual social contract by demonstrating the clarification of the firm’s exposure. Thus the deal is being made by showing the explanation of the work which is being made by illustrating the process for showing the appropriate work environment (Powers and Needles, 2012). The enhancement of the study can be easily made by indicating the explanation of the resources which is being used for showing the political and the social pressures and also it is very much hard for presenting the exposures in this political and the social pressures. The present and modern movement of the government is governed by the social contract of the legitimacy theory. The government should know about the legality of them. In the present situation, both the utilization of the social contract and the legitimacy theory is most relevant. This simply explains the study which is being represented by showing the explanation of the individuality work. It also explains the management feelings which are managed by the affecting the character and also the effect can be simply judged. The legitimacy theory enables in assuming the society which also explains the society which will be explaining the proper structure for the representation of the work. The transform of the environment of the stakeholder’s actions are also enables them in justifying the appropriate reasons for the actions (Nobes and Parker, 2016). The legitimacy theory is shown the executed in the various characteristics that create the necessary explanation of the work which can explain by showing the differences difficulties illustrating in the open regulations and also the development of the challenges which is made by demonstrating the social performance and the environmental. Therefore the vitality is being provided for the institution of the actual changes in the organizational presentation and also the activities can be suitably managed by showing the proper participation of the activities.
Through the application of technology and the internet in the field of accounting the flow of information and the utilization of data on economic performance can be changed. The theory of legitimacy provides a framework for the efficient reporting of the financial information through help from the internet. According to the paper published in 1997, the description by Wildstorm contains the information relating to the importance of the cyberspace in the communication of financial information. According to the legitimacy theory, IFR or the financial report presented through the internet is distinct from the traditional reporting of the financial information. The IFR can possibly include the information that is voluntary, incremental or mandatory and may help the various stakeholders of the company in the decision making procedure. There is a significant role played by IFR in regulating the report and the formation of the report on the environmental factors (Previts, 2010). It has the ability to differentiate between the reporting of the printed audit and that of a financial report which is based on the review obtained from electronic sources. A relationship can be established by the Internet between the stakeholders, and it can help in the communication of interactive nature for the purpose of development of the financial position of the particular company. In the year 1999, Layman and his team with the help of the support from International Accounting Standards Committee devised the analysis of the reporting of internet accounting with the help of the theory of legitimacy. In the year 2002 the Liao and his team and in the year 2003 Debrecev devised a description of the report that the financial information can support the auditing by the professionals, the accounting and the regulation of the report of the financial matters derived from the internet. In the year 2003 Poon and Tak Yu made the statement that the financial reporting through the internet could also include the report on the annual performance, the quarterly performance, the report on the analysis, the press collection, information on the pricing of shares and management issues as well. By means of the research conducted in 2005 by Garcia-Borbolla and his team the relationship existing between the enterprises of small and medium scale enterprises along with the website, the company size, the educational aspects, the training, the management and the implementation of the technology can be realized (Schroeder, Clark and Cathey, 2011). According to the recommendations made by Khan in 2007 for developing the characters of qualitative nature, the companies have the chance to improve the financial reporting through online sources which are prescribed by the International Accounting Standard Board (IASB). The positive features of the reporting of financial information through the internet are that by means of this process the department concerned with accounting responsibilities within any organization is able to represent its financial report through the digital format, that is, through portable document format (PDF). This will ensure that there are no possibilities for any misplacement of the reports. In 2010 Aly and team introspected the possible profitability in the Internet utilization for the social contract for accounting. He included the firm size, the number of auditors, the liquidity and the website owned and operated by the company. There are a number of analyses which identify the reporting on financial information by means of the internet. The primary hypothesis of the financial reporting is given a justification through the theory of legitimacy. The analysis of the contract on social and environmental aspects of accounting, that is, the social and environmental contracts in the field of accounting is able to describe in brief the role that the legitimacy theory plays (Scott, 2015). The role of financial reporting through the internet is also described. The internet reporting done on voluntary basis helps to maintain the relationship that the auditors and the investors share. The acceptance of this voluntary financial reporting through the internet can influence the qualitative as well as the quantitative factors existing within the company. The financial reporting through the internet which is mandatory is a matter of concern with the conference and with the press release. It proves to be useful for the accounting standard for the communication to the hard annual report and the information that is designed to regulate the balance sheet and statements of income. The analysis in quantitative terms concerned with the annual financial report belonging to different industries might be the consequence of the portion dealing with social contract in the legitimacy theory in the field of accounting. The study of the theory of legitimacy shows that the policies existing within the company have been modified and are related to the events of social significance of accounting events (Stolowy, Lebas and Ding, 2013). From the result, the tactical nature of the contract for social purpose is evident which includes also the management along with the report on the annual performance. This is valid under the conditions which are unfavorable. The study of the contract which is of the corporate social nature supports the theory of legitimacy. The resulting observations from the analysis of the subject matter make the indication that a much higher level of the attention from the media had been achieved which will provide a boost for the financial report. The results from this study benefit the process of decision making and provide help for the preparation of the report on financial information. Regarding the results that originate from the study, the legitimacy theory is able to describe the type of the political economy in consideration and the government’s responsibility towards the procedures of accounting. The view that the there has been the utilization of annual financial reports by the companies for justification of their existence is supported by the results of the study (Stolowy, Lebas and Ding, 2012). There is the support of the view that the companies are utilizing the reports on the annual financial performance for the justification of their existence. The results help in establishing the difference between the two different types of the industries, among which there are the industries which are “k-based” are of one type. The results of the study give the evidence of how the annual financial reports of the companies are being utilized for the justification of their existence. The analysis between the variable which is independent in nature has the results which are related to the total asset, income, and the enterprise-size. There can be the assistance in the making of the financial report by the results originating from the study of the profitability. The examination of the information which is presented in the format in every report of the annual performance may disclose the terms of the social contract. It is evident from the results that the legitimacy theory is acclaimed to be globally sustainable. The survey results provide the political, environmental and social supports to the company considered. The indication of the results is that the firms can legitimize their own existence in the global scenario (Ve?ron, 2007). The results that are concerned with the legitimacy theory voluntarily participate in the enhancement of the reputation of the organization. There wasn’t any relationship found by the results between the independence of the board and the SDI. There is the clear indication of the professional or institutional governance of the company. The philosophy of liberty is considered by the legitimacy of the government. To explain the definition of the importance of the term legitimacy is govern by the perfect symbols. Various definitions of legitimacy theory are discussed by Suchman which are known as the most significant. The un-natural financial state of the country can be recovered by the application of the legitimacy theory. The relation between the freedom individual is also determined by the barriers and boundaries of measured by the legitimacy hypothesis. The social and the environmental laws bound the individuals to push them in the process of the sovereign (Weil, 2017). The political, legal and the ethical obligations are adopted by the individuals who help to determine the freedom of the person and the company as well. The common person chose the obligations willingly with the application of the legitimacy theory. According to Hobbs, there is no relation between the application of legitimacy theory in the privet sectors and the using of legitimacy theory in the government sectors. The social and the environmental contract of the legitimacy theory are not considered as the equal as per Hobbs. The government and the representative all are selected by the citizens, so they follow all the rules and regulations of the court. The court should follow the rules and the regulations related to the legitimacy theory. In this case, the common people should communicate with the independent determination of the government and the un-natural death of anybody. The society can be able to achieve the financial scope, and the development of the communication and the international market also can be achieved by the company with the application of the legitimacy theory in their business finance. To fulfill the independent determination any single person cannot break the standard rules and legal issues of the government and don’t involve himself in any kinds of authority (Monger, 2010). The person’s decisions are related to the decision of the individual. To form a political civilization, the individuals patch up the state of nature and the decision of the government which is directed by the external force. It also has an environmental impact to the shareholders which are also measured by the analysis of the applied legitimacy theory to the company. the companies are forced by the government to assist the legal issues of the authorities which were the only power to control the condition of nature. According to the application of the legitimacy theory, all the human rights and the rights of the authorities should be passed to the government and the people should follow all the rules. The internet financial reporting also related to the political issue of the legitimacy theory. The agreement of the terror and the pressure is also supported by the legitimacy theory. The data delivered by the legitimacy theory depend on the separation of the diverse sectors. With the modification of the work process and the application of the legitimacy theory, the companies become more ecological than other industries (Krivogorsky, 2012). The obligation about the legitimacy theory proposed by the government is not always right. It can also be modified by the applicators. The social and the environmental agreements do not fully depend on the legitimacy theory. The human rights related to this theory can be confined by the state, central or local court. The researchers over social and environmental contract were done by the Hopwood which was totally based on the legitimacy theory. The nation of the possessions and the decision of the government make the dissimilarities between the person and the community. The companies and the individuals get the motivations about the social and the environmental contract is supplied by the legitimacy theory. The legitimacy theories are adopted by the companies when they are facing the challenges from the shareholder; then this legitimacy theory helps to overcome the situation. The application of the legitimacy theory and the relevancy of the theory have a pure doubt to be utilized in the hypothesis. In the accounting, the study of the social contract which is related to the legitimacy theory can be able to describe the internet annual financial reporting which is governed by a hypothesis (Libby, Libby and Short, 2014). According to the various analyses report of the legitimacy theory, the government and the individual agreements shows the human rights to protect their ethics and the culture from the obligations. They can protect their ethics from the obligations by using the legitimacy theory and the natural effects law which don’t have any effect on the future generations. The authorization of the potential generations is also related to the administration and the management of the firm and the government also. The greater powers are applied to the management which helps to movement of the body of the government. The consisting of the common consent is truly complicated, the motive of this movement to contribute to the voting system. The legitimacy theory is responsible for controlling the political and the economic management of the government. It is responsible for improving the financial report which is suggested by the international accounting standard committee (IASC). The presence of the internet financial report assists in preparing the financial report of any governmental organization.
Conclusion
The legitimacy theory is responsible for controlling the political and the economic management of the government. It is responsible for improving the financial report which is suggested by the international accounting standard committee (IASC). The social and the environmental laws bound the individuals to push them in the process of the sovereign (Britton and Waterston, 2013). The political, legal and the ethical obligations are adopted by the individuals who help to determine the freedom of the person and the company as well. The results that are concerned with the legitimacy theory voluntarily participate in the enhancement of the reputation of the organization.
References
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Glautier, M., Underdown, B. and Morris, D. (2011). Accounting theory and practice. Harlow [etc.]: Financial Times Prentice Hall, an imprint of Pearson.
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Horngren, C. (2014). Accounting. Toronto: Pearson Canada.
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Nobes, C. and Parker, R. (2016). Comparative international accounting. Harlow, England: Pearson.
Powers, M. and Needles, B. (2012). Financial accounting. [Mason]: South-Western, Cengage Learning.
Previts, G. (2010). A global history of accounting, financial reporting and public policy. Bingley: Emerald.
Schroeder, R., Clark, M. and Cathey, J. (2011). Financial accounting theory and analysis. Hoboken, NJ: Wiley.
Scott, W. (2015). Financial accounting theory. Toronto: Pearson.
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