The topic of integrated reporting <IR> is new to Part 1 of the CMA exam . It was added to the exam due to its relevance, as integrated reporting is to corporate reporting what blockchain is to IT: both are vying to be the next “hot thing.” Blockchain is also new to the exam, but for now we will limit ourselves to just the integrated report.
So if integrated reporting is the next big thing, we need to . Profit Creation figure out bulk sms russia why. To figure that out, let’s start by looking at the evolution of corporate reporting.
The evolution of corporate reporting
Let’s begin our discussion of <IR> with the evolution of corporate reporting. This will help us better understand how integrated reporting fits into the corporate reporting process.
It would be an understatement to say that the corporate reporting process has undergone few changes over the past few decades.
Even the idea of corporate reporting has changed dramatically in recent years. For example, if we fast forward to the 1960s, as shown in Table 1, corporate reports were primarily concerned with basic financial metrics:
balance sheet;
income statement;
cash flow statement.
However, over time, corporate reports have become increasingly content-oriented, including management commentary, as well as management reports and pay reports. This has occurred because investors and other external users have wanted more detailed information about what has been happening in the company.
Gradually, by the early 2000s, sustainable growth and social responsibility reports were included in annual reports along with financial information.
Table 1: Evolution of Corporate Reporting
The table shows that there is a targeted move towards an integrated report. So, how does <IR> compare with other company reports? For comparison, let’s look at Table 2, paying attention to the following indicators:
focus and key drivers;
target audience;
regulatory requirements.
Table 2: Comparison of the Corporate Report with other reports
The table shows that integrated reports are more forward-looking than other types of canada data reporting. Integrated reports include both financial and ESG (environmental, social and governance) information. Let’s dig deeper into the concept of integrated reporting.
What is Integrated Reporting?
The idea of <IR> itself arose many years ago, but it was formalized in 2010 with the founding of the International Integrated Reporting Council (IIRC). The committee was formed by an international coalition of regulators, investors, companies, standard setters, professional accountants and NGOs.
Their aim was to promote integrated reporting as an alternative form of reporting.
If you go to the IIRC website, you will see the following definition of an integrated report:
“Integrated reporting is a process based on integrated thinking that results in an digitalization of the vehicle title issuance system in a new episode on the pro business channel organization’s periodic integrated report on its value creation over time, with appropriate communications related to aspects of value creation.”
Under this definition we read further that an integrated report is:
“a precise expression of how a company’s strategy, management, performance, and prospects in the external environment lead to value creation in the short, medium, and long term.”
We clearly see that the common denominator between these two definitions is the term “value creation” and the call for businesses to focus more on factors, including non-financial metrics, that create longer-term value.
This all makes perfect sense because if a business is unable to create value for its investors, customers and others, then what is the purpose of the business?