Discuss the implications of the increasing length of annual reports Table of Contents Introduction 3 Purposes and Importance of Annual Report 3 Increasing Length of Annual Report and its Implications 4 Conclusion and Recommendations 6 Reference 7 Bibliography 8 Introduction Since last five decades, there has been a massive change in the global business environment…
In this regard, many independent and regulatory authorities have tried to protect the investors’ and shareholders’ interest from managements’ biases by taking major steps like corporate governance and accounting policies. Publication of annual reports is one the basic responsibilities. With tightening policies from regulatory authorities, the managements are required to disclose number of information other than financial statement. This paper will attempt to present the purposes and increasing length of annual report and its implications (Stittle, 2003, p.143). Purposes and Importance of Annual Report Annual report is primarily associated the disclosure of the financial report of a corporate which is important for the users like prospective investor, existing shareholders and creditor for making economical decisions. Financial information is highly required as it shows the financial health of the organisation like financial risk, stability, volatility, assets, liabilities etc (Valencia College, n.d.). However, merely disclosing the financial information does not serve the purposes for protecting shareholders’ interest by offering sufficient level of transparency. ...
The annual report also discloses other necessary information which is highly required for ensuring the biased free information. For example, the company also discloses accounting policies, footnotes which act as empirical studies for the stakeholders. Form the companies’ perspective, annual reports are also used for market signalling by disclosing a number of voluntary news and recent developments. Moreover, the annual reports are prepared in the simplest way so that a person with basic knowledge of economics is able to understand the internal information and activities. The companies are obligated to ensure that each of its stakeholders is able to access the annual reports and hence, publicly listed companies are responsible for publishing its annual reports through corporate websites, economic journals and news papers, and subscriptions (Vause, 2009, p.9). Increasing Length of Annual Report and its Implications To make the annual reports more relevant with enhanced disclosure has become a challenge for both the regulators and firms. On one hand, regulatory authorities require that the companies’ annual reports must be understood by ordinary shareholders and investors; on the other hand, they are required to include complete and transparent disclosures. The recent financial crisis of 2007-2010 has marked the importance of financial disclosures. The international and independent organisations like FRC, OECD, IASB and FASB require wide ranges of information as mandatory disclosure. The IFRS and US GAAP are two major financial reporting frameworks that recommend upon the accounting standards and disclosures in the annual report. Their requirements of disclosure have been constantly increased for better transparency and monitoring the activity of the ...
Cite this document
(“Discuss the Implications of the Increaing Length of Annual Reports Essay”, n.d.)
Retrieved from https://studentshare.net/finance-accounting/47945-discuss-the-implications-of-the-increaing-length
(Discuss the Implications of the Increaing Length of Annual Reports Essay)
“Discuss the Implications of the Increaing Length of Annual Reports Essay”, n.d. https://studentshare.net/finance-accounting/47945-discuss-the-implications-of-the-increaing-length.
An annual report comprehensively provides stakeholders and other interested individuals or institutions an overview of a company’s activities and financial performance throughout a given year, usually the one preceding the current year. As such, annual reports contain reports by the chairperson, the CEO, and the auditor.
The 2010 Deloitte survey on narrative reporting found that the average length of the annual report was 101 pages. As per the analysis of Accounting Standards Board (ASB), annual reports of organizations contain immaterial clutter that distracts the reader from the most important information.
and find the different approaches adopted by them. Both the giant companies are from the steel industry. Thus through the study of the annual reports of these two companies we will be able to assess the movement of the companies in the adaptation of its goals, challenges and plans.
According to the there are different reasons of why enterprises give importance to annual reports. Some of the reasons include clean market analysis, comparative financial assessment and productivity analysis which is no other possible if there are no annual reports to compare. It has been that in markets where there is a major population of investors and share holders then enterprises come out regularly with the activity of reporting.
In the business' field, talking about sustainability means taking into account not only the profits of the company but also its social responsibilities. Companies all around the world are increasingly becoming concerned about standards of sustainability by assuming this type of responsibilities.
Profitability is the condition for survival in the long run. The profitability ratios are return on capital employed, gross profit margin, net profit margin, return on assets, and return on owners' equity. Return on capital employed shows how much profit was earned out of every dollar of long-term financing.
According to the report Marks and Spencer has achieved a great success in the last three years and now it is in the progress focusing on core business and aiming at becoming more customer oriented and flexible business offering wide selection of quality goods. The overall performance of Marks and Spencer was extremely pleasing to the stakeholders.
While annual reports used to fall considerably below the 100-page mark during the last decade, a survey by business advisory firm Deloitte shows that in 2010, the average length of annual reports has reached an all-time high of 101 pages. The lengthiest reports are littered with more advertisement-like photographs and captions.
Brands Inc., to explore their approach to communicating annual performance, their goals, challenges and plans, as well as effects of the organizations’ annual report formats on communicating the intended
3 Pages(750 words)Essay
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Essay on topic Discuss the Implications of the Increaing Length of Annual Reports for FREE!