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Thought Activity: - Essay Example
The International Integrated Reporting Council (IIRC) has come up with the new framework of reporting. Clearly, this new form of reporting called Integrated Reporting (IR) takes a holistic approach towards the whole process of corporate reporting. …
It seems to me that IR takes into account different aspects of an organization like capitals, business model of the organization and the creation of value over time. When it considers capital it does not take capital as conventional financial accounting does; it considers other non-tangible capitals like ‘intellectual capital’, ‘human capital’, ‘social relationship capital’ and ‘natural capital’ along with financial and manufactured capital. I think IR is a totally new approach to corporate reporting, which demand skills to analyze qualitative information along with conventional financial data.
In my opinion, a person responsible for preparing a report in a format prescribed by IR needs to have some additional skills and knowledge along with conventional financial skills and knowledge. He will be no longer a passive accountant or examiner of finance related data; he will need to actively apply his knowledge, analytical skill and judgments.
I understand that the new means of reporting will pose a challenge to the present accounting professionals (accountants, auditors) who mainly work with figures and prepare financial statements. They need to acquire some additional skills and knowledge. In my poinion, accounting professional will need new training. The IR will change the way an accounting professional is trained and educated. ...