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Draft guide to effective business reporting processes published by IFAC

  • IFAC (International Federation of Accountants) (lt gray) Image

May 24, 2012

The Professional Accountants in Business (PAIB) Committee of the International Federation of Accountants (IFAC) has published an exposure draft, "International Good Practice Guidance (IGPG) — Eleven Principles for Effective Business Reporting Processes," which provide a broad range of recommendations in best practice business reporting.

The stated aims of the draft IGPG are (1) to establish a benchmark for good practice in implementing effective reporting processes in organizations, and, in particular, (2) to help professional accountants in business and their organizations create a cycle of continuous improvement for their reporting processes to assist internal and external stakeholders in making informed decisions about these organization by providing high-quality financial and nonfinancial information.

The exposure draft outlines the following principles:

  • Committing to effective reporting processes.
  • Determining roles and responsibilities.
  • Planning and controlling the reporting processes.
  • Engaging stakeholders.
  • Defining the reporting content.
  • Selecting frameworks and standards.
  • Determining reporting processes.
  • Using reporting technology.
  • Analysing and interpreting reported information.
  • Obtaining assurance and providing for accountability and transparency.
  • Evaluating and improving reporting processes.

In relation to the objective of selecting frameworks and standards, the exposure draft notes the following:

The organization should use reporting frameworks, standards, and guidelines to help develop effective reporting processes and to ensure that all relevant information is disclosed. Professional accountants may need to turn to sources beyond current financial reporting standards and regulations to make the best choices on reporting strategy so that reporting format, timing, content, and approach demonstrate transparency, credibility, relevance, and usefulness to the various stakeholders. Professional accountants will need to be familiar with the appropriate reporting frameworks, such as the International Accounting Standards Board (IASB)’s Practice Statement on Management Commentary, and the Integrated Reporting Framework, which is being developed by the International Integrated Reporting Coucil (see Appendix B for an overview of various frameworks).

The exposure draft is open for comment until August 23, 2012. Click for more information (link to the IFAC's Web site).

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