The advent of international accounting standards of IAS / IFRS as a reference system leads to a revolution in the world of business and communication thereof. International standards have a privilege over the economic approach to business, and are not historical as is often the case in French companies. This new approach will have impacts on financial reporting that will be studied. Indeed, for a group or a listed company, disclosure is the way that the Finance Department informs investors, shareholders, customers, suppliers, banks, etc about the financial health of the entity and its strategic choices or whether they relate to development prospects. IAS / IFRS are intended to provide a more detailed and more accurate vision of society. On the set of standards, namely IAS 41 and IFRS 7, more than 15 of them directly affect the communication group.
International standards have two objectives that are somewhat summarized as follows: To make the most faithful image of the company over its accounting records. To apply the four qualitative criteria that are: intangibility, relevance, reliabilityand comparability. In addition, the IAS / IFRS have a goal of transparency of information which requires groups to publish a more detailed financial information on the various strategic choices of the development of society.
The presentation of financial statements of enterprises depends on the international standard IAS 1. The balance sheet is not included in IAS 1, it provides only a list of information that is to be included either in the balance sheet or in the appendices. Due to the nature of Anglo-Saxon IFRS, the balance sheet approach will be more economic, financial and functional. It is a real change because the balance sheet according to the standards PCG had much more tax.Thus, it will be closer to the balance sheet and that of the current functional balance PCG.
In addition, IAS 1 informs one that the posts should appear in the balance sheet. These items are tangible assets, intangible assets, financial assets other than interests, customers and cash equivalents, investments accounted for using the equity method, inventories, trade and other receivables, cash and cash equivalents, trade and other payables, assets and tax liabilities, provisions, liabilities, minority interests, the issued capital and reserves.
In the balance sheet, a new item appeared, the Goodwill. Goodwill serves to highlight the numbers that were not recorded with French GAAP. These figures, which are usually related to the innovation effort at redemption or a business with little or no assets but bought at a very expensive rate due to skill or good ideas (usually a start-up) , had no value with the repository French (PCG 1999). Goodwill upsets the balance sheet, and it will be in many cases more important than before. The disclosure of a company will be so changed due to a disrupted balance sheet for assets that will explain better in many cases, the economic strategy of a company.
A company must include the earnings per share (basic and diluted) at the end of the income statement. This integration of earnings per share will bring about change to the corporate communication at general meetings. Indeed, the shareholders present at such meetings will therefore quickly see these figures that they should calculate to update themselves.
Tags: Standards of IAS and IFRS; impact of these standards; financial communications
[...] There is also the theme of communication on sustainable development. These indicators highlight the particular company's performance in the future, on a long term view. By publishing a report on the environmental, social and societal indicators certainly not new in themselves, since they were advised in the past by the AMF (Financial Market Authority), the company seeks to develop a communication with a new focus on the non- financial dimension that can improve its assessment and therefore its transparency to third parties and creditors. [...]
[...] But we must also look at whether the frequency of publication of financial information is fairly high. It can be seen that the optimal frequency distribution is not necessarily the maximum frequency. This frequency distribution can differ in several aspects. These aspects can be for example, the market in which it is located or the operators concerned. These operators may be shareholders, employees or officers who all have different interests, therefore a broadcast frequency that is optimal according to different viewpoints. [...]
[...] It will therefore be based on cost accounting rather than financial accounting. Indeed, financial accounting does not establish an economic performance. With IFRS, there are two possible ways to establish an income statement for a company: • a presentation by nature • a presentation by function With a presentation by nature, the goal is to consolidate income and expenses by nature or by category. With a presentation by function, the goal is to group/consolidate income and expenses for procurement, production, distribution and administration. [...]
[...] • These standards can be seen as an element of transparency that enhances the exchange market because they can be applied by many countries. But there are some disadvantages: • The implementation of its standards in a company takes between six months and one year, according to company size. • For the financial community, changes in calculation methods can be troublesome in the interpretation of certain names (such as fair value). • There may be discrepancies in information when two companies in the same area use two different reference frames (one that uses IFRS and the other PCG 1999). [...]
[...] The company will have to comment on these figures, for example, if they have not achieved the desired results, which implies a change in the way they communicate. Diluted earnings per share are expected to affect the shareholder with fully paid rights by the company. This therefore improves the transparency of it in its financial communication. The income statement should change its name in the coming years to be renamed "Table of recognized expenses and income" Contribution in the annexes Financial documents in accordance with IFRS are much less detailed financial records according to French standards (PCG 1999), so the details will be found in the appendices. [...]
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