国际会计学第六版chapter5
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Stock exchanges want to be sure that investors have enough information to evaluate a company’s performance and prospects.
Disclosure protects investors, but shareholder protection varies across countries.
Helps users understand how the parts make up the whole
Product lines and areas of the world vary in terms of risks, returns, and opportunities
11
Reporting and Disclosure Practices (contin)
International Accounting, 6/e
Frederick D.S. Choi Gary K. Meek
Chapter 5: Reporting and Disclosure
1
Learning Objectives
Distinguish voluntary and mandatory disclosure and the applicable regulatory measures.
social, and environmental performance “Triple-bottom line reporting”: profits, people,
planet Increasingly being audited to avoid the charge
of “green-washing”
Forecasts are inherently unreliable. Legal repercussions if forecasts aren’t met.
9
Reporting and Disclosure Practices (contin)
Segment disclosures
Or do the requirements protect investors and ensure the quality of U.S. capital markets?
Sarbanes-Oxley requirements are also believed to deter foreign companies from listing in the U.S.
Management development Compensation Diversity Human rights
14
Environmental reporting Impact of production processes, products, and services on
Identify the broad objectives for accounting disclosure systems in investor-oriented equity markets.
2
Discuss “triple-bottom line” reporting and why it is a growing tendency among large multinational corporations.
13
Reporting and Disclosure Practices (contin)
Examples: Employee reporting
Employment levels and personnel costs by division and region of the world
Air Water Land Biodiversity Human health
15
Water, raw material, and energy consumption Activities to reduce pollution Spending on all of the above
5
Twin objectives of investor oriented markets (Frost and Lang 1996):
Investor protection Investors are provided with material information. And are protected through monitoring and enforcement.
7
Reporting and Disclosure Practices
Forward-looking information Includes
Forecasts of revenues, income, cash flows, capital expenditures
Prospective information about future economic performance or position
Special disclosures for non-domestic financial statement users
Language translations and currency restatements
Discussion of GAAP differences Limited restatement of income and
Have a basic understanding of the following selected corporate financialdisclosure practices: (a) disclosures of forward-looking information, (b) segment disclosures, (c) social responsibility reporting, (d) special disclosures for nondomestic financial statement users, and (e) corporate governance disclosures.
3
Development of Disclosure
Voluntary disclosure
Voluntary disclosures are increasing as investors demand more detailed and timely information.
But managers’ incentives for disclosure aren’t always aligned with those of investors.
Statements of management’s plans and objectives for future operations
8
Softer information about future prospects is more common than precise forecasts. Why?
stockholders’ equity to another GAAP This is the SEC requirement Complete financial statements using another GAAP, such as IFRS
17
Reporting and Disclosure Practices (contin)
Social responsibility reporting
Reporting to “stakeholders”: employees, customers, suppliers, governments, activist groups, the general public, in addition to investors.
Disclosure regulations and third party certification can improve the functioning of capital markets.
4
Development of Disclosure (contin)
Regulatory disclosure requirements
Despite criticisms, becoming mainstream among multinational companies
Global Reporting Initiative has issued guidelines
16
Reporting and Disclosure Practices (contin)
12
The measurement and communication of information about a company’s effects on employee welfare, the local community, and the environment
A way to demonstrate corporate citizenship “Sustainability” reports integrate economic,
Corporate governance disclosures Governance means the responsibilities, accountability, and relationships among shareholders, board members, and managers to meet corporate objectives.
Must reconcile net income and stockholders’ equity to U.S. GAAP if the registrant uses another GAAP.
Do SEC requirements deter foreign companies from listing their securities in the U.S.?
Disaggregated information about a firm’s industry and geographic operations and results
Includes disaggregated information on Revenue Income
10
Depreciation and amortization Capital expenditures Assets Liabilities
18
Governance issues include:
Rights and treatment of shareholders Responsibilities of the board Disclosure and transparency Role of stakeholders
Market quality Markets are fair, orderly, and efficient. And free from abuse an reporting debate
Foreign registrants must furnish financial information substantially similar to that required of domestic companies.
Disclosure protects investors, but shareholder protection varies across countries.
Helps users understand how the parts make up the whole
Product lines and areas of the world vary in terms of risks, returns, and opportunities
11
Reporting and Disclosure Practices (contin)
International Accounting, 6/e
Frederick D.S. Choi Gary K. Meek
Chapter 5: Reporting and Disclosure
1
Learning Objectives
Distinguish voluntary and mandatory disclosure and the applicable regulatory measures.
social, and environmental performance “Triple-bottom line reporting”: profits, people,
planet Increasingly being audited to avoid the charge
of “green-washing”
Forecasts are inherently unreliable. Legal repercussions if forecasts aren’t met.
9
Reporting and Disclosure Practices (contin)
Segment disclosures
Or do the requirements protect investors and ensure the quality of U.S. capital markets?
Sarbanes-Oxley requirements are also believed to deter foreign companies from listing in the U.S.
Management development Compensation Diversity Human rights
14
Environmental reporting Impact of production processes, products, and services on
Identify the broad objectives for accounting disclosure systems in investor-oriented equity markets.
2
Discuss “triple-bottom line” reporting and why it is a growing tendency among large multinational corporations.
13
Reporting and Disclosure Practices (contin)
Examples: Employee reporting
Employment levels and personnel costs by division and region of the world
Air Water Land Biodiversity Human health
15
Water, raw material, and energy consumption Activities to reduce pollution Spending on all of the above
5
Twin objectives of investor oriented markets (Frost and Lang 1996):
Investor protection Investors are provided with material information. And are protected through monitoring and enforcement.
7
Reporting and Disclosure Practices
Forward-looking information Includes
Forecasts of revenues, income, cash flows, capital expenditures
Prospective information about future economic performance or position
Special disclosures for non-domestic financial statement users
Language translations and currency restatements
Discussion of GAAP differences Limited restatement of income and
Have a basic understanding of the following selected corporate financialdisclosure practices: (a) disclosures of forward-looking information, (b) segment disclosures, (c) social responsibility reporting, (d) special disclosures for nondomestic financial statement users, and (e) corporate governance disclosures.
3
Development of Disclosure
Voluntary disclosure
Voluntary disclosures are increasing as investors demand more detailed and timely information.
But managers’ incentives for disclosure aren’t always aligned with those of investors.
Statements of management’s plans and objectives for future operations
8
Softer information about future prospects is more common than precise forecasts. Why?
stockholders’ equity to another GAAP This is the SEC requirement Complete financial statements using another GAAP, such as IFRS
17
Reporting and Disclosure Practices (contin)
Social responsibility reporting
Reporting to “stakeholders”: employees, customers, suppliers, governments, activist groups, the general public, in addition to investors.
Disclosure regulations and third party certification can improve the functioning of capital markets.
4
Development of Disclosure (contin)
Regulatory disclosure requirements
Despite criticisms, becoming mainstream among multinational companies
Global Reporting Initiative has issued guidelines
16
Reporting and Disclosure Practices (contin)
12
The measurement and communication of information about a company’s effects on employee welfare, the local community, and the environment
A way to demonstrate corporate citizenship “Sustainability” reports integrate economic,
Corporate governance disclosures Governance means the responsibilities, accountability, and relationships among shareholders, board members, and managers to meet corporate objectives.
Must reconcile net income and stockholders’ equity to U.S. GAAP if the registrant uses another GAAP.
Do SEC requirements deter foreign companies from listing their securities in the U.S.?
Disaggregated information about a firm’s industry and geographic operations and results
Includes disaggregated information on Revenue Income
10
Depreciation and amortization Capital expenditures Assets Liabilities
18
Governance issues include:
Rights and treatment of shareholders Responsibilities of the board Disclosure and transparency Role of stakeholders
Market quality Markets are fair, orderly, and efficient. And free from abuse an reporting debate
Foreign registrants must furnish financial information substantially similar to that required of domestic companies.