Corporate Accounting Assignment: Preparing IR
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Added on 2020-05-28
Corporate Accounting Assignment: Preparing IR
Added on 2020-05-28
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Corporate Accounting 1CORPORATE ACCOUNTINGBy (Student’s Name)Professor’s NameCollegeCourseDate
Corporate Accounting 2CORPORATE ACCOUNTINGIntroductionThis critical report discusses the probable benefits of preparing (IR) and its limitation.The IIRC describes IR as the method that is found within the integrated thinking that leads to aconstant IR to the company about creation of value as well as the aspect of the formation ofvalues. The IR is a brief message that deals with the way the firm’s governance, prospects,prospectus, as well as strategy, in the perspective of the outside environment contribute tocreation of value in the medium, long term and short. Different Companies around the globaladopt the use of integrated reporting (Adams, 2015). Therefore it is essential to recognize howintegrated reporting has evolved, benefits vs. costs, problems preventing extensive adoption aswell as how the problems can be overcome, and methods in which momentum can be createdaround the implementation of the IR. Application of IR enables different organizations toenhance delivery of their services (Huber and Bassen 2018). The preparation of the integratedreport must be according to the IIRC (International Integrated Reporting Committee). The paperis separated into different parts. First part narrates benefits that are associated with thepreparation of the integrated report. The second part discusses the limitations of using theintegrated report in the organization.Benefits of preparing IR (integrated report)IR enhances the way different Institutions think, plan as well as reporting the issues thataffect the enterprise. Institution applies IR as a chance of communicating a brief, clear, combinedstory that enlightens the way in which value is generated in the institution (Flower 2015). Theintegrated report is used as an approach that assists companies to reason holistically about the
Corporate Accounting 3plans as well as strategy, developed well-thought decisions, control key risks and opportunitiesto strengthened stakeholders including the investors’ self-confidence, and assist in managing theperformance of the organization. Institutions of all sizes can use integrated reporting to buildtrust and understanding in their business (Sierra, Zorio and García, 2015). As a manager orbusiness owner, safeguarding you’re your finance providers, suppliers, external stakeholders andcustomers trust is important. Integrated reporting help in building trust in the business byemphasizing on what drives value. Understanding value creation requires integral thinking, acrucial theme of the Integral reporting, which is built on splitting internal silos betweendepartments and people to enable the organization to collectively understand the maincomponents of the business. This comprises of the strategy, governance, business model, andrisks and opportunities in the context of issues and trend that affect the business. Integratedthinking also encompasses an organization taking into consideration the various resourcesconsumed, and correlation it depends on, enables it to be in a position of making decisions thusensuring its resilience and viability over time (Cheng, Green, Conradie, Konishi and Romi,2014).Besides improving internal management processes, IR can also cause other importantbenefits, including It, create greater credibility and trust with suppliers, customers, society, andother stakeholders. This is essential since its help non-governmental organization andgovernment agencies to look for the commercial partners that will not only supply services andgoods that they require but do so in a sustainable manner. Integrated reporting can help inmaximizing the potential to sell, transfer, or handing over the enterprise by providing a betterplatform for valuation, as well as securing financing at a favorable cost. Integrated reporting actas a mechanism of communicating the vision of the company about the future and the company
Corporate Accounting 4solve nonfinancial opportunities and challenges, thereby improving the self-confidence of theinvestors in the Company and its capability of building sustainable value. Another benefit of theintegrated reporting is that it reduces risk associated with reputational. It is capable of reducingexpectation-reality link between the company and external parties through communicating in atransparent and holistic way the performance, position, mission, vision, and philosophy of theinstitution in both financial terms and sustainability. Integrated reporting is being applied as thetechniques of improving relationships, engagement, as well as dialogue with the stakeholders.For instance, clients who value things that deal with sustainability will be dedicated to theactivities of the organization. It can also improve engagement of the employees through internalcollaboration and coordination since it needs unrelated units of the company to join as one inorder to come up with an integral report. Integrated reporting can enable the organizations toimprove their internal control and measurement systems for making timely and reliablenonfinancial information. By adopting the use of IR, organizations are capable of improving thequality of the data as well as monitoring internal controls system for nonfinancial data (Maroun2018). This is essential so that IR can satisfy the requirement of the auditing report required bythe external auditors.
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