Evaluation of Analysis and Reporting

This report evaluates the analysis and reporting of Evonik Industries using PwC value framework elements such as strategy, governance, risk, remuneration, resources and relationship, customers, people and culture, innovation, brands and IA, processes and supply chain. The report provides a comprehensive analysis of each element, including report extracts, critiques, accessibility, and comprehensiveness. The subject, course code, course name, and college/university are not mentioned.

Running head: EVALUATION OF ANALYSIS AND REPORTING
Evaluation of Analysis and Reporting
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1EVALUATION OF ANALYSIS AND REPORTING
Table of Contents
PwC value framework elements:.....................................................................................................1
Strategy: Goals and objectives.........................................................................................................1
Report extract: Page 10................................................................................................................1
Reporting critique:.......................................................................................................................1
Accessibility:...............................................................................................................................2
Comprehensiveness:....................................................................................................................2
Overall conclusion:......................................................................................................................2
Strategy: Business model.................................................................................................................3
Report extract: Page 11 and Page 12...........................................................................................3
Report critique:............................................................................................................................3
Accessibility:...............................................................................................................................3
Comprehensiveness:....................................................................................................................3
Overall conclusion:......................................................................................................................4
Strategy: Governance.......................................................................................................................4
Report extract: Page 67................................................................................................................4
Report critique:............................................................................................................................4
Accessibility:...............................................................................................................................5
Strategy: Risk...................................................................................................................................5
Comprehensiveness.....................................................................................................................5

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Report extract: Page 46................................................................................................................6
Accessibility................................................................................................................................6
Strategy: Remuneration...................................................................................................................6
Comprehensiveness.....................................................................................................................6
Report extract: Page 79 to Page 87..............................................................................................7
Accessibility................................................................................................................................7
Resources and relationship: Financial assets...................................................................................8
Comprehensiveness.....................................................................................................................8
Report extract: Page 123..............................................................................................................8
Accessibility................................................................................................................................8
Resources and relationship: Physical assets....................................................................................9
Comprehensiveness.....................................................................................................................9
Report extract: Page 94................................................................................................................9
Accessibility..............................................................................................................................10
Customers......................................................................................................................................10
People and culture..........................................................................................................................11
Innovation......................................................................................................................................11
Brands and IA................................................................................................................................12
Processes and Supply Chain..........................................................................................................13
Organizational Performance..........................................................................................................13

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Operational....................................................................................................................................13
Economic...............................................................................................................................14
Social.....................................................................................................................................14
Environmental........................................................................................................................15
Segmental..............................................................................................................................15
Nature of Materiality.....................................................................................................................17
Conclusion.....................................................................................................................................17
Reference List................................................................................................................................18

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PwC value framework elements:
Strategy: Goals and objectives
Report extract: Page 10
Reporting critique:
This element helps in forming the strategy and goals of an organization comprising of
short-term as well as long-term goals. In other words, it aims to provide the users with the
necessary information of the future plans of the organisation and accordingly, they could
undertake significant decisions.

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Accessibility:
The strategic targets and objectives of Evonik could be accessed easily from Page 10 of
its annual report. The target of the organisation is represented in the form of a heading in bold.
The format of the extract is simple supported by clear descriptions for identifying the long-term
value intended to deliver. In case of Evonik, the principles and objectives of the organisation are
laid out in Page 12 of the Annual Report, in which they are associated with previous
performance and future priorities to represent the significance of long-term value.
Comprehensiveness:
On Page 12 of the Annual Report, Evonik discloses its strategy and yearly priorities for
increasing its business value and they include the following:
 Properly balanced and specialty portfolio
 Customer-concentrated and sustainable innovation
 Performance-oriented and open culture
Along with this, quantitative data related to each of the aspects are mentioned in the annual
report along with their past performance for explaining the relationship between the target of
long-term value and actual outcomes achieved.
Overall conclusion:
The 2017 annual report of Evonik helps in clear description of the strategic targets and
objectives of the organisation via effectively formatted information and understandable
reporting. Thus, the proper use of quantitative and qualitative data in association with the
priorities of the organisation increases the performance indication quality.

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Strategy: Business model
Report extract: Page 11 and Page 12
Report critique:
The business model of an organisation signifies the way of creating value for the same
and the interrelated factors.
Accessibility:
The business model of Evonik could be found from pages 11 and 12 of its annual report,
which is easily accessible for the readers, since it is disclosed as a separate section under the
heading business model.
Comprehensiveness:
The extract above represents four inter-associated elements with brief descriptions of the
interpretation of the business model. As a result, this enables in further explanation of the context
of the ways the elements intend to accomplish the objective of long-term value.

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Overall conclusion:
Evonik clearly cites its business model effectively over two pages and thus, the readers
could find such information easy to comprehend. This is because the elements describe the
operating processes of the organisation to ensure effective element quality.
Strategy: Governance
Report extract: Page 67
Report critique:
The governance performance indicator depicts the commitment of an organisation in
terms of reporting transparency. It helps in identifying the operating structures and the rules for
the board and its compliance committee.

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Accessibility:
The 2017 annual report of 2017 contains a section of corporate governance in order to
communicate performance information about governance reporting. This section contains 23
pages of the annual report and the users could find it easily from the section of contents.
Strategy: Risk
Comprehensiveness
Risk management is the application of management procedures, practices and policies
with regard to identification, analysis, treatment, assessment, communication and monitoring.
Evonik’s risk management strategies form the central element under the management of
company. At the company level the management of risk is assigned to CFO and is organized on
decentralized approach in compliance with the organizational structure of the company (McNeil,
Frey and Embrechts 2015). Further, the corporate divisions, segments and the service units are
primarily responsible for the risk management responsibility. It assists in identification of risk at
early stages and estimation of its implications.

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Report extract: Page 46
Accessibility
The risk management approach and strategies of Evonik can easily be assessed from the
company’s annual report for the year ended 2017. It is stated in clear and concise manner in the
annual report. Therefore, it is concluded that the organization’s health with regard to risk element
under the value framework is good.
Strategy: Remuneration
Comprehensiveness
The remuneration report states the principles of remuneration system applicable for the
members of Supervisory Board and Executive board together with structure and individual
remuneration level. The remuneration structure for Executive Board is formed to assure that the
members receive sufficient remuneration for their responsibilities and tasks and to receive the

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direct amount due on account of performance for each member of the company and each
member of Executive board (Farmer, Archbold and Alexandrou 2013). Further, the
remuneration is regularly reviewed by supervisory board where appropriate, based on the
remuneration reports received from the independent consultants.
Report extract: Page 79 to Page 87
Accessibility
The remuneration strategies of Evonik can easily be assessed from the company’s annual
report for the year ended 2017. It is stated in clear and concise manner in the annual report.
Therefore, it is concluded that the organization’s health with regard to remuneration under the
value framework is good.

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Resources and relationship: Financial assets
Comprehensiveness
Financial assets are the assets generated from the contractual agreements from the future
cash flows or from owing of equity instruments of any other company. The financial assets of the
company are included in the balance sheet of the company under the distinct head of financial
asset. Financial asset of the company includes securities and same kind of assets, receivables
from the derivatives, loans and various other financial assets Corporate.evonik.com 2018).
Report extract: Page 123
Accessibility
The financial assets of Evonik can easily be assessed from the company’s annual report
for the year ended 2017. It is stated in clear and concise manner in the annual report. Therefore,
it is concluded that the organization’s health with regard to financial asset under the value
framework is good.

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Resources and relationship: Physical assets
Comprehensiveness
The tangible assets are considered as the physical asset. Looking into the annual report of
Evonik Industries it is identified that the physical assets are nit presented under distinct head.
However, various physical assets of the company are property, plant and equipment and
inventories (Brigham et al. 2016).
Report extract: Page 94

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Accessibility
It is identified from the company’s annual report for the year ended 2017 that te physical
assets are not clearly presented. Further, the though the current assets and non-current assets are
presented clear and concise manner it is not very easy to identify the physical assets from the
assets section. Therefore, it is concluded that the organization’s health with regard to financial
asset under the value framework is bad.
Customers
Comprehensiveness:
The main strength of the company has been taken into consideration with maintaining a
balanced spectrum for the business activities, end markets and regions which are in close
collaboration with the customers.The future considerations of the company has been seento be
identifie4d with the identificationand solving of complex problems associated to the needs of the
customers (Borys, G. and Solarz2014).
Accessibility:
The proximity to the customers has been identified with the various types of the factors
which are based on the consideration for key competitive advantage as it aims to sell the
products with the consideration of the specific challenges. The accessibility aspect is further seen
with the three chemical segments which are in close association with the customer and markets.
The indept knowledge of the business of the customers are further depicted to drive the
profitable and sustainable growth among the business. In addition to this, the competitive
position with the customers is also seen with the innovative capability and integrated technology
platform. It can be said that overall the accessibility of the customer element is depicted to be
good(Hadi, Handajani and Putra2018).

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People and culture
Comprehensiveness:
The main information on the staff working for the RAG has been discussed with the
inclusion of the more than 36000 people working around the globe. The sustainable nutrition
program is another area for establishing the additional products and services associated to the
sustainable nutrition for the people and livestock. The disclosure on the responsible corporate
management strategies are further seen to be depicted to the association of the various
information that minimizes the use of scare resources (Hassanein and Hussainey 2015).
Accessibility:
The accessibility is depicted to be seen in terms of the annual report published by Evonik
and several commitments included in the Vision 2050, which is seen to act as a pathway for the
attainment of a sustainable world for the people with several limitations. The consideration of the
healthy performance culture has been considered with the success of the company and personal
motivation of the individual employee. Henceforth, it can be said that overall the accessibility of
the people and culture element is depicted to be good.
Innovation
Comprehensiveness:
The strategic focus of the company has been taken into consideration with the various
types of the consideration which are related to the focusing on the speciality chemicals and
bringing innovation along with performance-oriented culture (Balvers, Gaski. and
McDonald2016). In addition to this, the speciality chemical company is focused with a strong
market position which is seen to be based on the various types of the consideration taken into
consolation as per following sustainable business activities. The marketed oriented development

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and the research activities are further seen with the various types of the key drivers considered
with the profitable growth (Dhaliwal et al. 2014).
Accessibility:
The necessary information can be seen in form of the various types of the appropriate
sources which is seen to be available in the annual report of the company. The accessibility of
the aforementioned information was depicted to be easy in nature which is seen to be taken into
consideration with the particular element of the associated field of information. Henceforth with
the limited nature of the information it can be said that overall the accessibility of the Innovation
element is depicted to be bad in nature.
Brands and IA
Comprehensiveness:
The intangible assets are seen to be regarded with the various types of the aspects for the
appropriate customer relationships, technologies and brands. The intangible assets and the brands
average has been expected with the various types of the consideration for the licensing
information which is considered between 5 to 15 years (Al-Zarouniet al.2015).
Accessibility:
The aforementioned information for the brands of the Evonik industries can be traced
with the annual report of the company published in the year 2017.The main form of the
information on the international brands can be easily traced in terms of the gathering information
as per the intangible assets information published in 2017.Henceforth, it can be said that overall
the accessibility of the brands and IA is depicted to be good in nature.

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Processes and Supply Chain
Comprehensiveness:
The production process and products are taken into aspect with the product benefit and
supply chain and benefits provided to the customers. The transparency and sustainability aspect
are regarded with the entire supply chain. The disclosure on the unforeseeable production
stoppages in the SC globally and procurement markets (Koo2015).
Accessibility:
The information for the supplier is depicted to be available in the annual report of the
company. The information as per the annual report is seen to be based on the various types of the
consideration which are seen to be available in the annual report. However, the limited nature of
the information has led to several problems, which have shown that the disclosure of the
Processes and Supply Chain is bad in nature.
Organizational Performance
Operational
Comprehensiveness:
The company has divided the operations into three manufacturing segments, which are in
close association with the customers.
Accessibility:
The information for the operational aspects is depicted to be available in the annual report
of the company. The operational aspects are depicted to be limited in nature; therefore this is
seen to be ugly in nature (Guay, Samuels and Taylor 2016).

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Economic
Comprehensiveness:
In the chemical industry of the organization of Evonik, it can be observed from its annual
report that the organization is more vulnerable to the various economic fluctuations. It can be
identified from the annual report of 2017 that the competitive environment and weak economic
situation act as the significant impediments in the share market growth and product market share
(Phillips 2016).
Accessibility:
Based on the information provided in the 2017 annual report of Evonik, it can be
identified that no particular information is inherent in a single head and for the data assessment
the report has to be read comprehensively. As the information cannot be accessed easily, it is not
well formatted; one has to face problems to analyse. Hence, it can be said that the performance
quality for the element economic in the Value Framework is bad. The specific data should be
provided under a single heading.
Social
Comprehensiveness:
The social refers to the relationship of the chosen organization of Evonik with its
communities, customers, professionals, healthcare regulators, investors, suppliers, distribution
partners, service providers, governments and other various stakeholders. Hence, the organization
has a corporate citizenship that is responsible (Ehiedu 2014). The organization deals with the
primary internal and external stakeholders along with the socio-economic investment are
highlighted on the delivery expansion of the products to the communities.
Accessibility:

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With the help of the annual report of Evonik in 2017, it becomes easy to access all the
data (Pappa 2015). The data is presented in an appropriate format and they are listed under
separate heads. Thus, it helps in clear understanding. Hence, conclusion can be made that the
performance quality for the element Social in the good Value Framework.
Environmental
Comprehensiveness:
The environmental factors consist of the natural resources that Evonik uses in order to
manage its business operations. These resources include water, air, minerals, land and
biodiversity. Evonik is committed to reduce carbon by implementing various strategies of site
management and the formal conservation projects. The management of the firm supervises the
emission throughout sites of manufacture.
Accessibility:
The information assessment can be done from the annual report of the firm Evonik for
the year 2017. The data is presented in an appropriate format and they are listed under separate
heads. This signifies clear understanding of all the aspects (Fazzini 2018). Hence, it can be
inferred that the performance projects of the environmental element in the value framework is
effective.
Segmental
Comprehensiveness:
Evonik analyses the accounting policies and the basis of presentation of the year ended
31th December 2017 by implementing segmental analysis in order to disclose the
hyperinflationary economy. In the segmental analysis, the operation of the group is segmented
and calculated based on the international countries where the business takes place. As per the

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integrated report of Evonik, calculation that is segment-wise has been done in the report. The
calculation helps to understand the revenue earned from each segment of the business. The table
is provided below:
Accessibility:
The segment regarding information has been provided separately in the annual report of
2017. Thus the accessibility of the information is easy. The well-structured format helps to
understand easily, thus it can be concluded that the quality of performance for the element
Segmental in the Value Framework is good.

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Nature of Materiality
At the time of determining of the materiality, the entityEvonikgenerally considers the
problem related to material that has the possibility to affect the organization ability to sustain and
create stakeholders value of the firm (Jonas2017). The company board has considered and agreed
that the strategic objectives of the company Evonik and the KPIs that are related with the stated
aims would constitute the material issues of Evonik in order to risks management.
Conclusion
The strategic focus of the company has been taken into consideration with the various
types of the consideration which are related to the focusing on the speciality chemicals and
bringing innovation along with performance-oriented culture.The various disclosures about the
accessibility of the of the most of the information is depicted to be good in nature. This is
specially seen in terms of the information revealed with the Customers, People and Culture,
Brands and IA is seen to be good in nature.However, the aspects such as Processes and Supply
Chain and Innovation is depicted to be bad in nature. In addition to this the disclosure on the
aspects such as operational aspects under Organizational Performance is seen to be ugly in
nature.

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Reference List
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OF CORPORATE FINANCIAL DISCLOSURE IN THE UNITED ARAB EMIRATES. Asia-
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Balvers, R.J., Gaski, J.F. and McDonald, B., 2016. Financial disclosure and customer
satisfaction: Do companies talking the talk actually walk the walk?. Journal of business
ethics, 139(1), pp.29-45.
Borys, G. and Solarz, M. (2014). Finance and accountancy for sustainable development.
Wrocław: Publishing House of Wrocław University of Economics.
Brigham, E.F., Ehrhardt, M.C., Nason, R.R. and Gessaroli, J., 2016. Financial Managment:
Theory And Practice, Canadian Edition. Nelson Education.
Corporate.evonik.com., 2018. [online] Available at:
https://corporate.evonik.com/Downloads/Corporate/BPK/Evonik_FB2017_E.pdf [Accessed 14
Jun. 2018].
Dhaliwal, D., Li, O.Z., Tsang, A. and Yang, Y.G., 2014. Corporate social responsibility
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Ehiedu, V.C., 2014. The impact of liquidity on profitability of some selected companies: The
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Farmer, M., Archbold, S. and Alexandrou, G., 2013. CEO compensation and relative company
performance evaluation: UK evidence. Compensation & Benefits Review, 45(2), pp.88-96.

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Fazzini, M., 2018. Financial Statement Analysis. In Business Valuation (pp. 39-76). Palgrave
Macmillan, Cham.
Guay, W., Samuels, D. and Taylor, D., 2016. Guiding through the fog: Financial statement
complexity and voluntary disclosure. Journal of Accounting and Economics, 62(2-3), pp.234-
269.
Hadi, A., Handajani, L. and Putra, I.N.N.A., 2018. Financial Disclosure based on Web-ICT
Determinants: Its Implications for Local Government Financial Performance in
Indonesia. International Research Journal of Management, IT and Social Sciences
(IRJMIS), 5(1), pp.72-85.
Hassanein, A. and Hussainey, K., 2015. Is forward-looking financial disclosure really
informative? Evidence from UK narrative statements. International Review of Financial
Analysis, 41, pp.52-61.
Jonas, G.A., 2017. Asian Financial Statement Analysis: Detecting Financial Irregularities.
Koo, J.H., 2015. B. Enhancing Financial Consumer Protection with Effective Disclosure of
Financial Information. Korean Economic and Financial Review, 20(2), pp.49-52.
McNeil, A.J., Frey, R. and Embrechts, P., 2015. Quantitative risk management: Concepts,
techniques and tools. Princeton university press.
Pappa, A., 2015. Financial statement analysis of a multinational company and equity valuation of
computer-based technology group.
Phillips, F., 2016. Withholding Financial Statement Analysis Formulas When Instructing and
Testing: A Desirable Difficulty.

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