Assignment on Financial Reporting Techniques and Its Importance
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Added on 2020-06-04
Assignment on Financial Reporting Techniques and Its Importance
Added on 2020-06-04
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TABLE OF CONTENTSINTRODUCTION...........................................................................................................................11. Objectives and Context of Financial Reporting.................................................................12. Analysing regulatory framework and the key principle with Qualitative characteristics..13. Analysing the main stakeholders in the organisation as well as fruitfulness of financialreports.....................................................................................................................................34. Measuring Importance of financial reporting in obtaining business efficiency and goals.35. Preparing the Financial statements for Rita plc..................................................................46. Financial ability of Apple Inc. in accordance with two year financial analysis.................67. Explaining the difference between IAS and IFRS.............................................................88. Evaluating advantages of IFRS..........................................................................................99. Analysing the various methods of IFRS and uses in several firms across globe...............9CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONIn the present assignment, there will be study over the financial reporting techniques aswell as its importance in meeting the organisational aims. There will be several requirements anentity such as generating the demand in market related with products or services as well asattracting numbers of investors to raise the capital fund. Hence, importance of such data settechniques as well as various tools used in disclosure of such informations. It includespreparation of income statements, balance sheet as well as analysis of financial ratios of severalorganisations such as Rita Plc and Apple Inc. Apart from these, there will be discussion based onuses of such financial used by various firm across the world.1. Objectives and Context of Financial ReportingFinancial reporting tends to help organisation or accounting professionals in context withfacilitating them a framework on which they can be able to learn of understand the methods ofpreparing such reports (Nobes, 2014). Hence, the main objective of such reporting techniques isthat, it will help in providing the transparency of informations as well as awarding firms withadequate manner of presenting such data set. Thus, there will be some goals of such reportingtechniques which are as follows:It helps the managers in providing informations to investors or the users of such reports.Thus, with the help of these methods professionals are facilitated with making betterreporting techniques which will fruitful for various external stakeholder to analyse theprofitability of entity as well as ability to pay dividends.It facilitates entity of professionals to make the proper tracking over cash flowstransactions held in the organisation.The managers at the organisation will be beneficial in making the proper analysis ofassets and liability as well as their valuation. Aim of these techniques as to build up the strong capital structure of the firm as well asincrease in the efficiency in operational performance.2. Analysing regulatory framework and the key principle with Qualitative characteristicsTo have the better financial structure in firm there is need to develop the better policiesand regulations which will help them in better governance of qualitative knowledge. Thus, with1
the help of various conceptual frameworks as well as standards which are awarded by GAAP andIAS, IFRS in context with making the adequate disclosure of the accounts in the right manner(Wiesel, Skiera and Villanueva, 2013). Thus, such accounting techniques are highly used by theorganisational professional in consideration with attracting the numbers of stakeholders orinvestors to the entity. Hence, it can be said that, there are several principles and frameworkswhich will help in governing the method of presenting financial statements in authorised manner.Conceptual Framework: It consists of various guidances as well as theoreticalknowledge which will reflect in coherent and substantial reporting (The need for and anunderstanding of a conceptual framework, 2011). Thus, motive of facilitating these kinds oftheoretical guidance which will help in enhancing the basic knowledge relevant to the financialreporting. Hence, these reporting techniques will be helpful for organisation in context withsome importance:The conceptual framework can be seen as per the statements or standards facilitate byGAAP in context with having the better economic decisions.These structure and standards helps organisation in having better control over costs orexpense made during the year.It will be beneficial in developing the better communication method between variouscompanies.It causes the better decision making and the favourable corporate governance in entity aswell as helps in analysing the corporate responsibilities of the firm.Qualitative characteristics of financial reporting: There has been various characteristic ofsuch accounting techniques which in turn helps in acquiring the authenticated informations:Data must be relevant as well as comes from the authenticated sources, which in turnhelps the organisation in having the legal transaction related with sales, turnover as wellas capital gathering (Evans and Hnatkovska, 2014).Informations which are facilitated in data sheet must be concrete and relevant to the factswhich will attract the numbers of stakeholders to the firm.2
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