New standards will modernize and help rebuild confidence in financial reporting.
New standards will modernize financial reporting.
The global investor community is demanding higher standards of accountability, behavior and performance, particularly in light of recent business failures. Both industry and governments are responding with reforms that will serve to strengthen financial management, reporting and corporate governance.
This ever-changing business environment has brought additional requirements for more comprehensive performance reporting, looking beyond the numbers to non-financial indicators. Increasingly, to receive the confidence they need from the capital markets, companies will be expected to explain their values, responses to business risks, and the link between objectives and performance.
New standards are also being proposed in most major countries that will modernize and help rebuild confidence in financial reporting. Financial statements will become more transparent, using new concepts, such as fair value reporting.
Market reform will force companies to re-examine their corporate governance processes and procedures to ensure appropriate oversight. Board members will have to be independent and competent. Audit Committees will have to work more closely with senior management and outside auditors to ensure the quality, completeness, and integrity of their corporate reporting.