Financial Reporting

Financial Reporting.

Table of Contents
INTRODUCTION...........................................................................................................................1
1. Main Purpose of financial reporting........................................................................................1
2. Regulatory and conceptual framework of financial reporting.................................................2
3. Stakeholder of company..........................................................................................................3
4. Values of financial reporting for growth and development.....................................................4
5. Financial statements of the organisation..................................................................................5
6. Interpretation of financial statement of Marks and Spencer....................................................6
7 Difference between IFRS and IAS...........................................................................................7
8. Evaluation of benefits of IFRS................................................................................................7
9 Ascertaining the varying degree of compliance with IFRS......................................................8
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Financial reporting focuses to play an important role of accounting standard and principle
that support in creating valuable report and financial statement of company (Financial statement,
2018). This process is relate to examining, gathering and posting financial information into
balance sheet, cash flow statement and other useful financial documents. This support internal
manager to make crucial decision so that financial strength and position of company could be
improved. To understand the importance of financial reporting Mark & Spenser is selected.
In this project report, the main objective of financial reporting, its basic concept,
regulatory and conceptual standard are discussed. Report shows main stakeholder for company,
importance of reporting and interpretation of last two year financial statements. The main
purpose of report is to describe the importance of IFRS and its difference With IAS.
1. Main Purpose of financial reporting.
In accounting, financial reporting is defined as the process of formulating important
financial statements that disclose the financial strength and position of company during an
accounting year. These statement are presented to shareholder, creditor, investor so that actual
creditworthiness of company can be ascertained. With the help of detail report and statement
internal management of Mark & Spenser are able to make effective plan to improve the
profitability and productivity. It is very crucial that report must be create according to the
accounting standard and must be faithful, transparent and free from any misleading transaction.
The main objective and purpose of financial report to Mark & Spenser are described below:
 Financial reporting gives complete and faithful financial information to outside investor
so that they can make investment decision in M&S.
 With the support of transparent report, internal management of M&S are able to examine
performance of company during a particular period.
 It provide actual outcome of the various business activity to the external stakeholder that
increase profit, market share and sales.
Importance of Financial reporting.
 The main significance of financial reporting is to attract international investor so that,
M&S may expand its business at global level (Chae and Oh, 2016).

 Decently managed statements are really crucial for bid, government activity and labour
contracts because it help to give summary of the company and its business operation to
external parties.
So, it is very crucial that Mark & Spenser develop final account and statement, that
support them to manage, control business operation and increase the profitability and financial
position. It is very important to analyse the actual performance of company as it support to
execute further project more effectively (Al-Matari, 2013).
2. Regulatory and conceptual framework of financial reporting.
Regulatory and Conceptual Framework: In present era, it is very crucial that company
should use valuable analytical tool and apply accounting standard and principle prepare financial
statement during an accounting year. So regulatory framework are defined as the set of legal
standard and rules implement by UK legal authority. These framework are to be followed by
each and every company performing business in UK. On the other side conceptual framework
are defined as the tool with some variable that help to analyse the performance of business
operation. With the support of conceptual framework mark & Spenser is able to analyse the
overall performance of different business project and operations. Similarly, with the help of
regulatory framework accountant of M&S are able to create faithful financial statement that
further support to ascertain financial position and status during an accounting year.
Purpose of regulatory and conceptual framework:
 The main significance of Regulatory frameworks is to help internal manager to formulate
statements in suitable manner.
 And main purpose of Conceptual framework is to examine the actual performance of
company that is displayed to stakeholder so that investment decision are made in M&S.
Mark & Spenser is applying different set of regulation to maintain financial record that
are set By IASB that are imposed in the form of IFRS. International financial reporting standard
are set of key principle that are set by authority. Some of Key principle are discussed below:
 IFRS 3: These are related to actual concept of business combination of consolidation and
acquisition. It guide manager to combine all there liabilities and assets that help to pay
debt of company (Duncan, 2014).
 IFRS 9: This is related the set of rules that describe the treatment of different transaction.
It help to protection of accounting and damage of financial assets within company.