ACCA: Integrated Reporting Supports Better Business Performance and Stakeholder Relationships, but There is Room for Improvement

NEW YORK, April 13, 2017 /PRNewswire/ -- The adoption of Integrated Reporting, or <IR>, can be challenging but it generates tangible organizational, reputational and commercial benefits, according to <IR> adopters.

The Insights into Integrated Reporting report published by ACCA (the Association of Chartered Certified Accountants) draws together a review of 41 corporate reports from around the world with interview commentary from some of their preparers. The full report can be viewed here or at http://bit.ly/2o9Aucq.

"The aim of integrated reporting – through integrated thinking – is to create a more stable and sustainable global economy, by encouraging companies to think about how they do business in a more holistic and forward-looking way," said Yen-Pei Chen, subject manager – corporate reporting at ACCA. "In today's volatile environment, this vision is as pertinent as ever."

The report finds that reporting quality was high across <IR> Business Network participants, and extrapolates several common benefits from the adoption of <IR>, including: more integrated thinking and management; greater clarity on business issues and performance; improved corporate reputation and stakeholder relationships; more efficient reporting; employee engagement and improved gross margins. However, it also identified several areas where reporting can be improved, including:

• Value creation: widespread challenges in identifying and articulating what the organization's stakeholders perceive as 'value'.
• Connectivity: companies identified this as one of the biggest challenges with implementing <IR>: it required breaking down silos within the organization and changing existing data collection processes.
• Defining performance measures: thinking and practice is still immature in articulating the value organizations derive from non-financial capitals.
• Materiality: companies found it challenging to reconcile the needs of different stakeholders. Improving the materiality determination process could help drive improvements in conciseness, completeness and reliability.
• Conciseness: nearly half of the integrated reports reviewed ran over 150 pages. Companies found it difficult to reconcile conciseness and meaningful communication with stakeholders.
• Reliability and completeness: the reviewers felt that only 51% of the reports reviewed achieved a balance of good and bad news in equal measure. Companies need to know what 'good reporting' looks like, before they can implement internal control processes and consider external assurance on their integrated report.

"Our research has found passionate support for the aims of <IR> among business leaders, but it has also pinpointed specific barriers to better reporting," continued Chen. "I hope that our findings will drive action from standard-setters, regulators, professional bodies and researchers to help remove these barriers."

"As the uptake of integrated reporting continues to grow across the world, this study shows there is equal effort put in to raising the quality of integrated reports as well as the number," added Richard Howitt, CEO of the International Integrated Reporting Council.

"It is also shows the concrete advantages not simply of companies undertaking integrated reporting but of their joining the international <IR> Business Network, to learn with others and to be global advocates for change."

About Insights into Integrated Reporting
The Insights into Integrated Reporting report published by ACCA (the Association of Chartered Certified Accountants) draws together a review of 41 corporate reports produced by member organizations in the IIRC's (the International Integrated Reporting Council) <IR> Business Network – performed in 2016 in collaboration with the IIRC – with interviews with 9 integrated reporters around the world.

About ACCA
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. It offers business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. ACCA supports its 188,000 members and 480,000 students in 178 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 100 offices and centers and more than 7,110 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence. www.accaglobal.com

SOURCE ACCA (the Association of Chartered Certified Accountants)