Report to the Nations
ICAS is able to review your compliance arrangements – policies, procedures, resourcing, reporting etc. – to assess how well they meet ever-evolving regulatory expectations. We are able to conduct full compliance reviews or specific examinations of just one area. Reasons you may want to consider the independence and objectivity that only an external expert can provide include:
- Current best practice – make sure that you are up to date on the best way to stay compliant
- Changes in key personnel – understand your needs when key people join or leave your business
- Impact of takeovers of one regulated business by another on the firms’ compliance operations
- Regulatory visits – prepare your business for large scale thematic and other reviews
- Benchmarking – review your current arrangements drawing on ICAS extensive knowledge of current best practice
- Regulatory due-diligence following changes in senior management or in the event of the acquisition of a new financial services business.
What are financial reporting and regulatory reporting and why do they matter?
Both academics and market participants often refer to “reporting” as a “language” or a “communication tool” between a particular company and its external stakeholders. In their view, the aim of such communication is to reduce the information gap between these external stakeholders and the company’s management, commonly referred to as “information asymmetry”. Yet, this communication can only be effective if both the management and the external stakeholders speak the same language.
In other words, the information provided must serve the needs of the stakeholders involved – and, ideally, be presented in a “catchy” way. International accounting standard-setters have developed their own interpretations of these requirements: in their jargon, financial reporting information must be “decision-useful” and “understandable”. In my view, this could easily be summarised by the term “transparency”. Financial reporting information can be said to be “transparent” if it provides correct insights into the financial position and performance of a company, and if it reveals any risks the company is facing.
However, this is not enough. Effective communication is facilitated significantly by the global spread of a particular language. In reporting terms, there is no doubt that this can best be achieved by a single set of global reporting standards. Applying the same language globally reduces the risk of misunderstandings and enhances consistency of the information provided. This could be summarized by the term “comparability”. The significance of this criterion is also acknowledged by accounting standard-setting bodies.