ACC702

ESSAY 1
(15%)
GROUP MEMBERS:

1.PATRICK SHIVNIL DEO – 2018000167

2.SHIVENDRA NAICKER- 2018000339
3.SHAZIDA BIBI- 2018002105
 ANNUAL REPORT INVOLVING NON FINANCIAL
INFORMATION

In order to review the value of any firm’s financial performance and value, stakeholders
in any organization need to go through non-financial information. This involves
reporting on social, environmental and diversity matters which will lead to greater
transparency in reporting. Thus, this essay aims to critically analyse the need for
extending boundaries of annual report with non-financial information and outlining the
importance of non-financial information in financial report along with the future
possible trends in reporting of non-financial information.

Moving on, non-financial information is important as inclusion of non-financial data in

financial reports creates a closer link to long-term organizational strategies. Thus it is
noted that companies do not deal with progress relative to customer or competitors or any
non- financial objectives that lead to profitability, strength and goals. With the
implementation of accounting measures which involve reporting with non- financial data,
companies can now communicate objectives and address long term strategy. Non-financial
data provides indirect, quantitative indicators of firm’s intangible assets. Also, including
of non-financial data in financial reports are better indicators of future financial
performance. Along with that non- financial information covers the measures which are
put in place so that managerial actions can be evaluated. Hence, inclusive of non- financial
such as volume drivers, quality, customer and employee satisfaction helps investors in
decision making. As such, there is a transparency of report which leads to improved
credibility of a company. Lastly, it benefits the companies in areas such as increasing
confidence in the business, improving the brand image, risk avoidance, internal staff
relationship, and environment issues and attracting new employees.