Accounting Report: Integrated Reporting, Purpose, and Theories

This report provides a comprehensive analysis of corporate integrated reporting within the field of accounting. It begins by defining the concept of accounting and its application in the context of corporate social and environmental disclosures, emphasizing the shift from stand-alone reports to integrated reporting. The report explores the purpose and necessity of corporate integrated reporting, highlighting its role in enhancing stakeholder engagement, promoting ethical business practices, and fostering long-term financial sustainability. It delves into the International Integrated Reporting Council (IIRC) framework, its principles, and the benefits of integrated reporting for internal and external stakeholders. The report also examines the components of integrated reporting, including the business model, opportunities, risks, and strategic plans, as well as the importance of value creation and the use of historical financial statements. The conclusion summarizes the key findings, emphasizing the increasing complexity of stand-alone reports and the significance of integrated reporting in creating a reliable and transparent accounting structure.

ACCOUNTING

Table of Contents
INTRODUCTION...........................................................................................................................1
Purpose and Necessity of corporate integrated reporting and the theories.................................1
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Accounting is a concept or subject which is used as a measurement tool in various
streams as per their needs and requirements. This is a process of retaining records and
transactions, evaluating and a way of communicating information about economical structure of
organisation. In this essay, concept of accounting is elaborated in respect of corporate social and
environmental disclosures (van Bommel, 2014). Corporate social responsibility defines duties
and liabilities of organisations in terms of society, stakeholders and the environment. This is
considered as a business approach suitable to assist organisational structure more flexible and
convenient to society and stakeholder welfare.
CSR makes operations and management of organisation more viable and ethical and
helps to attain economic, social and environmental benefits. This is also one of the essential
aspect subject to building credibility and faith among stakeholders, society and environment.
There is a specific board formed in organisations for monitoring CSR activities. These activities
remain associated with awareness about human rights, corporate governance, environmental
effects, working conditions, health and safety and economical aspects.
Purpose and Necessity of corporate integrated reporting and the theories
It is seen that last two decades, corporate social and environmental disclosures are
increasing in separate stand alone reports in addition to types of other media. That organisations
are not adapting the basic structure of integrated accounting process. Stand-alone reports are
rapidly used by organisations for presenting information and details to stakeholders and the
external parties. Stand-alone reports remain more complex and critical to understand and
elaborate the dimensions of use. These reports increased the level of complexity in respect of
making financial reports and analysing financial plans. Moreover, these reports also create
problems for stakeholders to understand the corporate governance and dimensions of business.
Stakeholders, government and environmental aspects are considered important elements which
remain essential in terms of accounting. A proper disclosure is required in terms of analysing the
structure and compliance and financial reporting (Lodhia, 2015).
Corporate integrated reporting remain involved in analysing and evaluation of corporate
governance structure, analysis of basic needs and requirement to maintain financial
sustainability, creation of values and standards to make ethical and environmental friendly
1

compliance structure of business. Integrated reporting is used as a tool to explore the vision of
analysis and evaluation of compliance and corporate governance.
International Integrated Reporting Council launched introduced a framework for
integrated reporting. This contains principles and concepts related corporate rules, policies and
concerns. This helps to sort out organisational strategies, performance, governance and prospect
which vantage the creation of values. This encourage managers to prepare reports and
performance in respect of strategies which are elaborated subject to capital use. It provides long
term overview and vision of organisation (Monterio, 2014).
Integrated reporting plays vital role in internal decision making process and strategic
planning. Primary purpose of integrated reporting is to provide an overview of organisation in
terms of building strong infrastructure of This is basically helps to align all the essential aspect
which remain associated with corporate governance and managing, maintaining ethical structure
of organisation. This provides an ethical structure to present the information in systematic
manner so that stakeholders and society be able to understand the aim and objective of
organisation. It defines the strategies and plans related for corporate social responsibilities and
corporate governance structure.
These reports not only helpful for external parties and stakeholders of organisation but
also remain essential for internal parties such as employees, managers, business parters, board of
directors, owners, suppliers, customers, legislators, compliance managers and authorities, policy
makers and finance planners. This is basically remain associated with effective use of capital and
management and alignment of resources for assisting the structure of business. Integrated
reporting reduce the burden of sorting out equations and complexities which remain associated
with capital finance and planning. Value creation is also one of the main objective of Integrated
reporting.
There are types of information are essential in financial planning and reporting while
preparing compliance strategies and plans. This mainly assist corporate reporting, legal and
compliance structure, making action plans and future vision, long term objective and focusing
towards forecasting and projection of financial plans (Corporate Integrated reporting, 2018).
There is a use of historical financial statements and reports to make corporate reports and
integrated reporting purpose. It creates path to next generation of the annual reports and enables
stakeholders to frame informed structure of organisation.
2

To build an viable and reliable compliance structure integrated reporting are considered
within organisational context. This provides a base to elaborate and make the accounting
structure suitable for both stakeholders and environment. Value creation is the main base of
compliance structure (Benn, Edwards and Williams, 2014).
Principle based framework
International Integrated reporting Council (IIRC) provides a principle based framework
through which organisations can disclose and measure the standards of presenting financial
information. This permit all kind of business entities to set out their own compliance and
corporate standards, rules with the help of pre decided rules. It prevents the checklist approach. It
enables organisations to execute their values creation in more effective and organised manner.
This is not a single point which remain associated with analysing plans and strategies for
effectiveness of plans and objectives. IFRS rules related to financial reporting and financial
planing are considered in this context. This provides more revenant and reliable aspects in
respect of financial performance and compliance structure of organisation.
Materiality and facts are the main objective of integrated reporting. Information and
detail are advisable and acceptable only when then these information contains relevance and
reliability. Legal consolidation, assessment of risk associated with corporate financial aspects
and reliability and relevance. Regulatory reforms and legal structure is followed for making
integrated reports. It also provide an insight into the organisation's sources and connections with
capital finance and creating capital values. These capitals are considered as financial
manufactured, human, social and relationship, intellectual and natural capital (Maas, Schaltegger
and Crutzen, 2016,).
Apart form it there are few components used while framing compliance structure of
organisation. Integrated reposting is made around some key components such as overview and
in-depth knowledge about the business structure and external environment which is operated
effectively, it build the supports its ability to create values, business model, opportunities and
risks are directed with the help of company's intellectual properties, allocation of resources and
relevant strategies. Plans are also proposed to elaborate dimensions of corporate ethics and rules.
There are some presentation needs remain associated to elaborate the quantitative aspects related
to corporate ethics and governance.
3

CONCLUSION
There analysis of integrated reporting in social and environmental aspect done in this
essay. It is seen that from past two decades stand-alone reports are creating complexity to
stakeholders, societies, communities and corporates. CSR and integrated reporting was
disappearing form the system. This essay present an overview of accounting and reporting in
respect of corporate social and environmental disclosures and complexity of stand-alone reports
also defined. There is a critical analysis and evaluation done in respect of purpose and necessity
of corporate integrated reporting and the theories. Purpose and necessity of corporate integrated
reporting for stakeholders, communities, societies and internal parties are defined in this context.
Role of IIRC in respect of building the structure of Integrated reporting with in the organisation
also explained.
4

REFERENCES
Books and Journals:
van Bommel, K., 2014. Towards a legitimate compromise? An exploration of integrated
reporting in the Netherlands. Accounting, Auditing & Accountability Journal. 27(7).
pp.1157-1189.
Lodhia, S., 2015. Exploring the transition to integrated reporting through a practice lens: an
Australian customer owned bank perspective. Journal of Business Ethics. 129(3).
pp.585-598.
Monterio, B.J., 2014. Integrated reporting and corporate disclosure. Strategic Finance. 95(9).
p.54.
Benn, S., Edwards, M. and Williams, T., 2014. Organizational change for corporate
sustainability. Routledge.
Maas, K., Schaltegger, S. and Crutzen, N., 2016. Integrating corporate sustainability assessment,
management accounting, control, and reporting. Journal of Cleaner Production. 136.
pp.237-248.
Online
Corporate Integrated reporting, 2018. [online] Available thrugh:
<http://www.accaglobal.com/in/en/student/exam-support-resources/professional-exams-
study-resources/p2/technical-articles/iirc-framework.html>.
5