Understanding Investors: Directions for Corporate Reporting

Investors have lost trust in the corporate information since the global financial crisis. That is one of the findings in this report from ACCA. The report is based on a survey of 300 investors in UK and Ireland, conducted in March 2013, with several in-depth interviews with leading persons from the investment industry. Although the survey took place in UK and Ireland, the outcome is applicable internationally.
 
The report states that better reporting is essential to attract investment and build deeper relationships. However, investors must also take responsibility and should engage more with the regulatory and standard-setting processes. 
 
Key findings:
  • Almost two-thirds of investors place greater value on information that has been generated outside the company
  • Sixty-three percent of the investors still view the annual report as an important information source to understand a business, but critics request companies to “cut clutter” to make it less complex 
  • Nearly two-thirds of investors think management has too much discretion in how it reports the numbers in the reports
  • As many as 46% of the investors think that mandatory quarterly reporting should be abandoned
  • More than 90% of the investors think an integrated report with both financial and non-financial information would be a valuable source of material
  • Forty-five percent of investors are using Extensive Business Reporting Language (XBRL), but only 24% of the users find it valuable 

 

 

 

 

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