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Executive Summary - Essay Example

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The auditors’ examination of the narrative section is cursory, unlike the special attention paid to the financial section. Graphs are the key ingredient of the narrative section for the readers of the annual report, and…
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Executive Summary
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Executive Summary

Annual reports are the basis on how stockholders and others view the performance of an organization, influencing their decision to retain the stocks or not. The annual report consists of a financial section and a possible narrative section. The financial section remains accurate, because of the attention paid to it by the auditors. The decision to have a narrative section and what it contains is decided by the organization, which is influenced by their financial position.
Graphs in the narrative section play an important part in the comprehension of the narrative section. Yet, the graphic designer through selection of graph type, color, scale, and emphasis, and the like, can manipulate the perception of the reader of the narrative section.
The distortion of graphs in narrative section is clearly established through several studies. For example, the Canadian Institute of Chartered Accountants in 1993 reports fifteen different ways in which distortion in graphs can occur. Evaluation of financial graphics and the actual financial data in annual reports confirm the use of such graphic distortion.
Results of the literature review demonstrate that there is manipulation in selection and preparation of graphic representation that have implications for accountancy-related issues, international opinions, and the communications intended through the annual reports. However, a key question that remains unanswered is whether company size has any role to play in the manipulation of graphical representation in annual reports (Penrose, 2008).
This article presents the problem of the requirement for writing skills in accounting firms. Many of the bright university students choose to work in accounting firms. In this era of globalization, writing skills in accounting firms have gained in importance, raising the questions as to the specific requirements of writing skills in accounting firms, whether these needs ... Read More
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