International Financial Reporting - IFRS Assignment

International Financial
Reporting

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Purpose of financial reporting.................................................................................................1
2. Conceptual and regulatory framework....................................................................................2
3. Different kinds of stakeholders in the organization................................................................4
4. Need of financial information to meet the organizational objective and growth....................5
5. presenting financial statements of the company.....................................................................6
6. Interpretation and communication of financial information by using ratio analysis..............8
7. Difference between IFRS and International Accounting standard (IAS).............................10
8. Benefits of IFRS....................................................................................................................10
9. Varying degree of compliance with IFRS.............................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Financial reporting is the process of disclosing and communicate all the financial
information or the information related to the finance to the management and different users such
as investors, employee, customers, creditors, lenders, regulators, government etc. and inform
them about the growth and performance of the company. The aim of the accountancy firm is to
provide the financial information to their client and support their performance through efficient
decision making process. The report present the various role and purpose of financial reporting
achieving the target of the company. The different conceptual and regulatory framework
provides the set of rules ans regulation to regulate the performance of the company and the
various qualitative characteristics to help the organization to provide the information with the
accuracy and reliability. The report explains the different users of the financial information and
the benefits from the financial information. It also explains the different financial statement such
as income statement, balance sheet, ratio analysis etc. it highlights the benefits of IFRS and the
various financial standards like IFRS, IAS etc. in the organization to achieve the goal and
objective.
MAIN BODY
1. Purpose of financial reporting
Meaning : Financial reporting is the process of communicate the financial information to the
different external and internal users to evaluate the performance of the organization and improve
the productivity and profitability (Williams and Dobelman, 2017). Financial reporting helps the
company to analyses the various financial report to support the decisions of the management
team.
Purpose of financial reporting
Provide financial information : The main purpose of financial reporting is to provide the
financial information. It helps them to evaluate the financial position and the changes in the
financial position due to the internal and external changes in the company. It provides the various
information such as profit, revenue, sales, expenses, operating expenses etc.
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Provide legal support : It keeps the financial report legal. Financial report is governed
and regulated by different accounting standard such as GAAP, IFRS, IAS etc. which
provides the legal support to the information and protect the information and company from the
various scandals (Bonsall and et.al., 2017).
Analyze the information : It helps the users to analyses the information regarding the
company performance and position in the market and provide the information that whether the
company is able to sustain in the market or not. Stakeholders can get the information through
various accounting statements such as balance sheet, profit and loss account, cash flow, ratio
analysis etc. from the annual report from the organization.
2. Conceptual and regulatory framework
Conceptual frameworks : Conceptual frameworks help the company to analyses the
performance by setting objectives and policies for the organization. The aim of conceptual
framework to set fundamental concepts for the financial reporting system (Schram and et.al.,
2018). It helps to ensure that the standard are consistent and the all similar transaction are treated
in same manner so the investor can easily get the information and understand them in more
precise form.
Requirement of conceptual frameworks
 To set the general rules and regulation for the financial reporting.
 Set standard to measure the performance and provide the information in same manner to
the stakeholders.
 To treat the all similar transaction in same manner and methods.
Regulatory frameworks : Regulatory frameworks are used to set the rules and
regulation for the company to treat the financial transaction in the books of account (Laubichler
and Renn, 2015). It helps the company to decide that what should be recorded in the company's
account.
Requirement of regulatory frameworks
 It helps the company to follow the accounting standard in the organization.
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