ACC303 Advanced Management Accounting - Integrated Reporting Essay

This essay discusses the relevance of the Integrated Reporting (IR) Framework in the contemporary corporate world. It highlights the significance of IR in sustainability reporting, enhancing customer loyalty, and combining marketing, finance, and communication. The essay also identifies the company's performance on social, governance, and environmental parameters, enabling the company to achieve an optimum share price. It emphasizes the role of IR in creating sustainable value for stakeholders, presenting information clearly, and complying with financial and global reporting standards. The framework's application in both private and public sectors, its impact on strategy and control through investor information, and the influence of six capitals (human, natural, financial, intellectual, social, and relationship) on strategic management accounting are also examined.

Integrated
Reporting

Integrated Reporting
– Organisations rely on such information as it contributes to sustainability reporting
– Enhances customer loyalty thereby improving brand value
– Combines marketing, finance and communication among public companies,
investors and stakeholders
– Identifies the company’s performance on social, governance and environmental
parameters
– Enables company in achieving optimum share price by reflecting fundamental
value

Significance of IR framework in
the contemporary corporate
– Helps in creating a sustainable value for stakeholders in both medium and
short-term course of business
– Leading organisations apply such a concept for presenting information in a clear
and concise manner
– Organisations including IR provide important information on external
environment
– IR importance can be noted organisations as they comply to our financial
standards and global reporting standards

IR in private and public
sector– IR framework is evident among private companies such as Philips, Novo Nordisk, BASF,
American Electric Power (AEP) and United Technologies Corporation (UTC)
– Publicly listed companies have appointed dedicated IR officers (IROs), who monitors
the private meetings with investors, shareholders
– Connect sustainability strategy of the business to assist the companies and
stakeholders
– These officers are also seen to be providing the necessary assistance for holding
conferences
– Disclosing necessary information pertaining to risks of investors which are related to
climate change

IR impact on strategy and control
– Provide vital information to the investors which can inculcate stronger control
and strategy in a corporate entity
– IR Models have been conducive in facilitating important information related to
decision-making on investment
– Control factor is evident with making the necessary disclosure on risk mitigation
– Significant improvement in setting the financial strategies based on
accomplishment of fundamental goals

Six capitals impacting strategic
management accounting
– Human capital is identified to lead changes which are depicted in form of recognition, internal
events, external events and remuneration of the employees
– The natural capital is identified to provide an environment in which other capitals can fit in
– Financial capital is able to derive the strategy changes such as sales revenue, liability recognition
and leasing techniques
– Intellectual capital can be seen with the changes following the intellectual property rights in an
organization
– Social capital is inferred as the factors which broadly encompasses the effectiveness of how social
groups function with interpersonal relationships
– The relationship capital is defined as the sum of organisations connectivity in a marketplace both
indirectly and directly

Thank You