BAO3309 Integrated Reporting Analysis: CPA Report and IIRC Framework

This report provides a comprehensive analysis of integrated reporting in the context of the Australian business environment, drawing upon the CPA Australia report and the International Integrated Reporting Council (IIRC) framework. It begins by defining the role of the IIRC in establishing a globally accepted framework for value creation communication. The report then examines the existing and potential roles of integrated reporting with respect to stakeholder information needs, engagement, reporting comparability and quality. A comparison is made between the CPA report findings and the IIRC's guiding principles, including stakeholder relationships, materiality, conciseness, reliability, completeness, consistency, and comparability. Furthermore, the report identifies the similarities and differences between the International Framework and general purpose financial reporting, focusing on objectives, users, and materiality concepts. Finally, the integrated reports of four companies are compared against the IR Guiding Principles, and factors explaining the similarities and differences are discussed. This analysis offers insights into the practical application and challenges of integrated reporting in Australia.

Running head: ADVANCED FINANCIAL ACCOUNTING
Advanced Financial Accounting
Name of the Student:
Name of the University:
Author Note:

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Table of Contents
Introduction......................................................................................................................................5
Question 1........................................................................................................................................5
With reference to the IIRC website and relevant accounting literature, explain the role of the
International Integrated Reporting Committee (IIRC)....................................................................5
Question 2........................................................................................................................................6
With reference to the research findings of the CPA report and the relevant accounting literature,
explain the existing and potential roles of integrated reporting with regards to:............................6
Part A...........................................................................................................................................6
Providing information that is relevant to stakeholders................................................................6
Part B...........................................................................................................................................7
Stakeholder engagement..............................................................................................................7
Part C...........................................................................................................................................7
Comparability of reporting..........................................................................................................7
Part D...........................................................................................................................................7
Quality of reporting.....................................................................................................................7
Part E...........................................................................................................................................8
Usefulness of reporting................................................................................................................8
Part F............................................................................................................................................8
Users of reporting........................................................................................................................8

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Question 3........................................................................................................................................9
Comparing and contrasting the findings of the CPA report with the following guiding principles
that underpin integrated reporting:..................................................................................................9
Part A...........................................................................................................................................9
Stakeholder relationships.............................................................................................................9
Part B...........................................................................................................................................9
Materiality....................................................................................................................................9
Part C.........................................................................................................................................10
Conciseness................................................................................................................................10
Part D.........................................................................................................................................11
Reliability and completeness.....................................................................................................11
Part E.........................................................................................................................................12
Consistency and comparability..................................................................................................12
Question 4......................................................................................................................................13
Identification and explaining the similarities and differences between:.......................................13
Part A.........................................................................................................................................13
The definition and objective of the International Framework with the definition and objective
of general purpose financial reporting as contained in the IASB or AASB conceptual
framework..................................................................................................................................13
Part B.........................................................................................................................................14

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Identification of the users of an integrated report and identification of the users of general
purpose financial reporting........................................................................................................14
Part C.........................................................................................................................................14
Integrated report concept of materiality and the IASB conceptual framework concept of
materiality..................................................................................................................................14
Part D.........................................................................................................................................16
Integrated report concepts of reliability, completeness, consistency and comparability and the
IASB conceptual framework concepts of reliability, completeness, consistency and
comparability.............................................................................................................................16
Question 5......................................................................................................................................17
Comparing and contrasting the integrated reports of four companies that appears in the examples
database of the integrated reporting website with respect to any four of the IR Guiding Principles
.......................................................................................................................................................17
Question 6......................................................................................................................................22
Discussing the factors that may explain the similarities of differences that is identified in the last
question..........................................................................................................................................22
Conclusion.....................................................................................................................................23
References and Bibliography.........................................................................................................24

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Introduction
This study deals with understanding the role of International Integrated Reporting
Committee by referring to the IIRC websites as well as relevant accounting literature. In the next
segment, explanation had been done to understand the potential roles of integrated reporting with
regard to stakeholder engagement, comparability of reporting, quality of reporting, usefulness of
reporting and users of reporting. The current segment compares the findings of the CPA report
with the following guiding principles and these are stakeholder relationships, materiality,
conciseness, reliability and completeness, consistency and comparability. In the next segment,
comparison had been done between the objectives of International Framework and general
purpose financial reporting as mentioned in the IASB or AASB conceptual framework. In the
last segment, comparison had been done between four companies (HULAMIN LTD, CEMEX,
MTN Group and DSM) and aligned with the IR guiding principles (stakeholder relationships,
materiality reliability and completeness, consistency and comparability).
Question 1
With reference to the IIRC website and relevant accounting literature, explain the role of
the International Integrated Reporting Committee (IIRC)
The International Integrated Reporting Council is one of the global coalitions of
regulators, standard setters as well as regulators and accounting profession
(Integratedreporting.org. 2018). The role of the International Integrated Reporting Committee is
to create a globally accepted framework to deal with a process that lead to enhance the level of
communications by any business on matters relating to value creation for specified time frame.

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This Committee together decides to bring development by conducting internationally accepted
integrated reporting framework. By creating this framework, it will help business organization to
get access to concise communications on how they can create value for given period of time.
IIRC are responsible in promoting communication on matters relating to value creation as the
next step is the evolution of corporate reporting.
Question 2
With reference to the research findings of the CPA report and the relevant accounting
literature, explain the existing and potential roles of integrated reporting with regards to:
Part A
Providing information that is relevant to stakeholders
Stakeholders are interested to get information relevant to their work. For instance,
environmental stakeholders show interest in getting information about environmental issues of
significance. These stakeholders have extensive but varied information needs that are
predominantly cannot be addressed by any single or static or annual integrated report. By
referring to the research findings of the CPA report and relevant accounting literature, it is found
that most of the stakeholders use reports as background information for conducting research for a
given company.

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Part B
Stakeholder engagement
The primary source of information that the stakeholder receives is through direct
engagement with the business companies. It is noted that stakeholder engagement is quite
interesting as stakeholders need more information about the information on how they respond to
prioritizing issues.
Part C
Comparability of reporting
Integrated reports fail to meet the informational needs of both stakeholders such as civic
as well as environmental. Addition to that, stakeholders deals with problems on matters relating
to comparability as well as quality at the same time.
Part D
Quality of reporting
It was found out by the financial stakeholders that the quality of integrated reporting
actually shows variation through significant means. These stakeholders are of the opinion that
the integrated reporting does not report lots of case studies and fails to set targets and do not have
narrations on how the issues are significant to the business. On the other hand, environmental
stakeholders pointed out issues on matters relating to reports that fail to include right indicators
like amount of lending to fossil fuel projects as well as providing headline information about
several smaller issues.

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Part E
Usefulness of reporting
The integrated reporting is useful at the time of conducting decision-making activities. It
is the stakeholders who had mixed views upon the usefulness of integrated reporting. The
objectives of integrated reporting were to understand the perspectives of the stakeholders on
matters relating to usefulness of integrated reporting at the time of undertaking decision-making
activities (Tweedie, Nielsen and Martinov-Bennie, 2017).
Part F
Users of reporting
Stakeholders are the users of integrated reporting that represents the producers of
integrated reports as compared to the usefulness of integrated reporting with the views of users
of reports.

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Question 3
Comparing and contrasting the findings of the CPA report with the following guiding
principles that underpin integrated reporting:
Part A
Stakeholder relationships
From the findings of CPA report, information can be gathered about stakeholder
relationships under the performance content elements that states that one of the key components
explain about state of stakeholder relationships (Cpaaustralia.com.au. 2018). On the other hand,
integrated reporting includes improved corporate reputation as well as stakeholder relationships.
Guiding principles Findings from CPA report Integrated reporting
Stakeholder relationships Stating stakeholder relationships Performance
Business
Part B
Materiality
From the findings of CPA report, it is found that environmental stakeholders wanted
business to disclose certain information on matters relating to environmental as well as social
impacts and information especially carbon gas emissions disclosure and climatic change. The
stakeholders wanted to disclose the materiality concepts as well as their impacts. For instance,

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there are many companies who have access to information to their own operations. In addition, it
is not that important unless the company has actual power generator or big energy user.
From the integrated reporting, it is noted that concept of materiality determines as well as
applies from the perspectives of value creation. By using the framework, it will be clear to
understand that an integrated report should be disclosing the information about matters that
predominantly affect the ability of the business to create value for short, medium and long-term
(Thomson 2015).
Part C
Conciseness
From the findings of CPA report, it is found that the companies largely praises about the
conciseness but even present information. One of the reporters was of the opinion that because of
level of detail, it was difficult to find potential information. In addition to that, other reporter felt
that recognizing the challenge of keeping the report in concise form is challenging task that
include all right information used for treating complex business.
From the integrated reporting, it is noted that most of the reporters finds it difficult to
render concise information and even they try to provide sufficient context to the readers so that
they understand the value creation process of an organization as well as level of performance at
the same time.

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Part D
Reliability and completeness
From the findings of CPA report, it is noted that more than 10 stakeholders questioned
about the reliability of integrated reports. However, at the same time argues that the integrated
information provides assurance as well as verification of the reports as it helps in providing some
level of confidence to few stakeholders. As far as financial stakeholders is concerned, they find
reliability in varied form as they deals with developing a reliability score for feeding into its
assessment process. Furthermore, other financial stakeholders are of the opinion that the data
provided should be reliable in nature. The information provided to the stakeholders should be
complete and hiding of any information will lead to distortion of important information (Stubbs
and Higgins 2014).
From the integrated reporting, reliability and completeness means balancing good as well
as bad news together (Simnett and Huggins 2015). From the findings, it was noted that principles
of reliability as well as completeness were quite encouraging as more than 68% of the reports
shows used neutral factual language as well as manages to avoid looking like marketing or
promotional tools. Furthermore, it is all about bringing improvement in the materiality
determination process as it will help in bringing improvements in conciseness as well as
reliability and completeness of information. Therefore, disclosing the materiality determination
process will help in enhancing the credibility of the reports in the most appropriate way.

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Part E
Consistency and comparability
From the findings of CPA report, it is found that major arguments were raised by the
stakeholders on matters relating to usefulness of integrated reports that is helpful in comparing
the reports. In addition to that, comparability is done between two or more companies within a
sector and this is equally important for the environmental stakeholders.
From the integrated reporting, consistency and comparability means allowing
comparisons to be made for given period of time with other business enterprise. Furthermore,
integrated reporters shows interest in presenting the reports with internal consistency as well as
measures for given period of time as compared to other companies.