XBRL data tags completed for US GAAP

The United States Securities and Exchange Commission has announced that XBRL data tags for the entire system of US generally accepted accounting principles has been completed. This will enable companies to more easily encode their financial statements in the XBRL language. XBRL makes the analysis and exchange of corporate financial information easier and more reliable by allowing data to be extracted and processed automatically by XBRL-aware applications. (View the SEC Press Release.)

Accounting for Sustainability

The reporting of sustainability and the embedding of that process in corporate and other organizations is becoming a significant global issue for the accountancy profession. What was once a peripheral aspect of corporate reporting is now moving into the mainstream accounting and reporting system. This is all happening at a time when the accounting profession has been moving from its traditional stance of measuring only financial figures to one that recognises “intangible” items that have just as much impact on a company's strategy and performance. The financial and economic data needs to be merged with social and environmental information to enable management to see the strategic impacts and possibilities as a whole. (View the Financial Times article "Clean reports add value" and visit The Prince's Accounting for Sustainability Project.)

Ceres Sustainability Reporting Awards 2007

The Association of Chartered Certified Accountants (ACCA) and Ceres, a US-based coalition of investors and environmental groups, has announced the sixth annual Ceres-ACCA North American Awards for Sustainability Reporting. The purpose of the awards program is to acknowledge and publicize best practice in reporting on sustainability, environmental and social performance by corporations and organizations, and to provide leadership to those companies that are publishing or intend to publish sustainability reports. In 1997, Ceres launched the Global Reporting Initiative (GRI), which has become the international standard for corporate reporting on the "triple bottom line" of economic, social and environmental performance. GRI is now an independent institution, with more than 1,200 companies using the guidelines.

Importance of the Annual Report

In a recent Annual Report Survey conducted by WithumSmith+Brown, three-out-of-four participants agreed that the annual report is the single most important publication a public company produces. The study included over one hundred individual investors, portfolio managers and securities analysts. Nearly 79% of all survey participants agreed that annual reports are an important tool in making investment decisions about companies. And, 90% of all participants agreed that annual reports should contain additional information facing the company and its industry, such as sustainability of the environment or corporate governance, and not just the company’s financial and shareholder issues. In addition, 81% of all participants prefer a printed annual report versus one in an electronic format.

Conceptual Framework—Joint Project of the IASB and FASB

The US Financial Accounting Standards Board (FASB) is redeliberating issues related to its Preliminary Views, Conceptual Framework for Financial Reporting: Objective of Financial Reporting and Qualitative Characteristics of Decision-Useful Financial Reporting Information. Specifically, it is addressing concerns raised by respondents about the role of stewardship in the objective of financial reporting and the logical flow of Chapter 1 of the Preliminary Views. The Board has decided that the “objective of general purpose external financial reporting is to provide financial information about the reporting entity that is useful to present and potential investors and creditors in making decisions in their capacity as capital providers.”

IASB issues revised standard on the presentation of financial statements

The International Accounting Standards Board (IASB) has issued a revised version of IAS 1 Presentation of Financial Statements. The revision is aimed at improving users’ ability to analyse and compare the information given in financial statements. The publication of IAS 1 marks the completion of the first phase of the IASB’s joint initiative with the US Financial Accounting Standards Board (FASB) to review and harmonise the presentation of financial statements. The second phase, which has already begun, is examining more fundamental questions about the presentation of information in financial statements and the IASB expects to publish a discussion paper on the subject within the next six months. (View the Press Release or visit the project web page.)