Prepare an internal financial management report with recommendations on how an (or your personal organization) organization can ethically meet financial reporting obligations including financial forecasting.
Include in your report current regulations and industry practices that are designed to ensure the credibility and accuracy of a company's financial reporting.
Financial reporting is the means by which information about an enterprise is communicated. Many different users have need for financial information in order to make important decisions. These users include investors, creditors, management, and governmental agencies.
Ethics and financial reporting
The ethical financial reporting requires that significant facts affecting the judgment of an informed reader must be disclosed appropriately. But recently there has been deterioration of ethics. This has happened due to numerous factors. Prominent of them are greed, lax government regulations, deteriorating character and culture.
We cannot say that the ethics will completely extinguish. Infact truth, trust, honesty all are the foundation of not only business but also society. Unethical actions are increasing but simultaneously the focus on corporate governance and ethical conduct has also increased. The strict laws, harsh punishment and the strong cultural beliefs can lead to the renaissance of ethics in the .business world.
The government recently introduced SOX act to ensure that the ethical functioning of the corporate. Lot of stress is on self regulation. Thus accurate and complete information must be made available by the organization.
With the recent debacle of various organizations like ENRON, WorldCom there was questionable role of financial reporting. Thus there is a greater stress on the corporate social/ethical responsibilities and accurate and increasing requirements of financial reporting. Thus the major reasons for increasing reporting requirements:
? Increase in complexity of the business environment (derivatives, business combinations, pensions)
? Greater Necessity for timely information (interim data, ...
In a 1022 word solution, the response provides excellent information.