Concise annual reports in compliance with Integrated Reporting for the win
Future possibility of an audit assurance for annual reports
By Shehana Dain
CA Sri Lanka President Arjuna Herath urged the business community to advance towards efficiently prepared brief annual reports in harmony with Integrated Reporting to bridge the gap between global reporting trends.
He stated that companies following the Integrated Reporting criteria will be having an added advantage at the Annual Reports Awards this year. The entries are been called now and the window will close on 10 September this year.
“We are concerned to look at the annual report itself and we have launched the guide of Integrated Reporting criteria which is beyond financial reporting. Our annual reports awards criteria captures these aspects we want companies to evolve and process in integrated concepts and make the annual reports more meaningful. Our main aim is to move Annual Reports towards Integrated Reporting,” Herath added.
He further stated that they are looking at the best practice guide to give a sample auditor’s report of the annual report. Herath noted, “We want to explore the possibility of anyone who wishes to have an assurance report on the annual report, which is data and information outside the financial statements so that the people could rely on the entire annual report as opposed to separate financial statements.”
Another factor he pondered on was the need to report on exceptions and put together an incisive and brief annual report reporting the compliance of each aspect in this code which leads to repetitiveness we want people to report only on exceptions.
This year the Colombo Stock Exchange (CSE) will be the strategic partner of the Annual Report Awards.
Speaking at the event CSE Chairman Vajira Kulathilake stressed the importance in producing timely annual reports. “Today with the advancements in social media, sources of information has increased a lot which has lead to false information circulating within the stakeholders. Therefore it’s very important to produce your annual reports on time to reduce complications.”
The competition which is celebrating its 51st anniversary will revolve around the theme ‘Clarity Redefined’ and is open to any organisation ranging from conglomerates, to NGOs to SMEs that produces an annual report.
This year’s competition based on its theme ‘Clarity Redefined’ aims to encourage organisations and the preparers of the annual reports to produce a clearer, cohesive and customised report to reflect the operations of each individual company.
Pic by Sameera Wijesinghe
CA Sri Lanka President Arjuna Herath and CSE Chairman Vajira Kulathilake handing over the Strategic Partner Sponsor Cheque others from left: CA Sri Lanka Secretary/CEO Aruna Alwis, Annual Report Awards Committee Chairman Tishan Subasinghe, CA Sri Lanka Vice President Lasantha Wickramasinghe, CSE Chief Operating Officer Renuka Wijayawardhane, CSE Chief Information Officer Chandrakanth jayasinghe, CSE Head of Market Development NiroshanWijesundara
Companies exceedingly focused on awards: Awards Committee Chairman
Annual Reports Awards Committee Chairman Tishan Subasinghe stressed that companies are more focused on the awards rather than staying true to the actual rationale of increasing information efficiency in capital markets.
Speaking to Daily FT Subasinghe said, “I feel that companies are more concerned about the awards as the annual reports are getting bulkier year after year. Therefore the practical usages of the reports are questionable.”
“With my experience I have noticed that some companies completely copy paste some narrative sections from other companies’ previous year’s annual reports; this is not what we expect. This may create ambiguity and this might result in passing unclear messages to the stakeholders,” he added.
However he stated that there is huge positive side to the awards as well citing that past award winners who maintained excellence have been able to secure lucrative business deals because of the quality of their annual reports.
Moreover Subasinghe noted that the judging panel of the Annual Report Awards Competition will continue to keep updating the checklists regularly to keep pace with the changes to the accounting standards and other relevant pronouncements, while also placing increased emphasis on disclosures pertaining to related party transactions.