Introduction

Objective of reporting
Principles of reporting
Importance of reporting
Qualities of good report
Types of Reports
Forms of Reports
Reports submitted to different level of Management
General Format of Reports
 Introduction
• The term 'reporting' conveys different meanings on different circumstances.
• In a short term it means supplying facts and figures.
• On the other hand, when a committee is appointed to study a problem, a report
is taken to mean that review of certain matter with its pros and cons and
offering suggestions
• A report is a means of communication which is in written form and it is useful
for management for the purpose of planning decision-making and controlling.
 Objective of Reporting
Means of communication:- A report is used as a means of upward communication.
A report is prepared and submitted to someone who needs that information for
carrying out the functions of management.
Satisfy interested parties:- the interested parties of management report are top
management, executives, government agencies, shareholders, creditors, customers
and general public. Different types of management reports are prepared to satisfy
above mentioned interested parties.
Serve as a record:- reports provide valuable and important records for reference in
the future. As the facts and investigations are recorded with utmost care, they
become a rich source of information for the future.
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Legal requirements:- some reports are prepared to satisfy the
legal requirements.
Basis to measure performance:- the performance of each
employee is prepared in a report form.
Control:- reports are the basis of control process. On the basis of
reports, actions are initiated and instructions are given to improve
the performance.
 Principles of Reporting
 Completeness:- The measures, in the aggregate, should cover all aspects of
the reporting entity's mission.
 Legitimacy:- Reports should be appropriate for the intended users and
consistent in form and content with accepted standards.
 User friendliness:- Reports should be understandable to reasonably
informed and interested users, and should permit information to be
captured quickly and communicated easily.
 Reliability:- The information presented in the reports should be verifiable
and free of bias and faithfully.
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 Relevance:- the report must be relevant.
 Consistency:- Consistency is required not only internally, but also over time,
that is, once an accounting or reporting method is adopted, it should be used
for all similar transactions unless there is good cause to change it.
 Timeliness:- The passage of time usually diminishes the usefulness of
information. A timely estimate may then be more useful than precise
information that takes longer to produce.
 Comparability:- Financial reporting should help report users make relevant
comparisons among similar reporting units, such as comparisons of the costs
of specific functions or activities.
 Importance of Reporting
i. It provides information to the management.
ii. Helps in selecting the best profitable alternative for future.
iii. Helps in controlling the performance.
iv. Helpful in profitable operations.
v. Helpful in achieving the overall objectives.
vi. And so on…..
 Qualities of Good Reports
 The report must have a suitable title.
 The report should be simple and easily understandable.
 A report should be prepared on time.
 A report must be comparable (i.e. comparing actual performance with
standard performance).
 A report must be consistent.
 A report should be precise, accurate and specific.
 A report must contain relevant information.
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• The reports should be specific and presented only to the person in need.
• Every report should contain the routine details (time of preparing report, date of
presentation of report, name of the person preparing and presenting it, name of
persons to whom it is being submitted etc.).
• The reports should give full details of variances such as favorable and unfavorable.
• The cost of preparing and presenting the report should be reasonable.
• The report must be useful to management for effective communication.
• The principles of exception should be followed while preparing and presenting the
reports.
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 The report may be in written, oral or graphic form.
 The style of presenting the report should attract the attention of the user of
the report.
 A report should contain only the latest information.
 A reports should be prepared and used only for selective areas.
 A reports should be prepared in a proper format.
Types of
Reports
 Types of Reports

On the basis of objects On the basis of nature On the basis of period On the basis of functions
and purpose

Enterprise Control Special Financial

Internal

External
Routine Operating
Investigating
I. On the basis of Objects or purpose
1. Internal Reports - Internal report is meant for different levels of
management. This can be classified into three types: (a) Report meant for top
level management, (b) Report meant for middle level management, and (c)
Report meant for lower level management . Internal report need not conform to
any standard form as it is not statutorily required to be prepared.
2. External report - it is prepared for meeting the requirements of persons
outside the business, such as shareholders, creditors, bankers, government,
stock exchange and so on. External report is brief in size as compared to
internal report and they are prepared as per the statutory requirements.
E.g. of external reports :- profit & loss a/c, balance sheet.
II. On the basis of nature
1. Enterprise Report – these reports are prepared for the concerns as a whole.
These reports serve as a channel of communication with outsiders. It may
includes income tax returns, balance sheet, income statement, employment
report, chairman’s reports and so on…
2. Control report – it deals with two aspects. One is relates to the
personal performance and other deals with economic performance.
The types of report are prepared for controlling the performance.
3. Investigating Report – these reports are linked with control reports.
These reports are prepared when there is some serious problem
arises for investigating and analysing the situation.
III. On the basis of period
1. Routine reports – these reports are prepared about day-to-day working of
the concern. They are periodically sent to various levels of management. These
reports may relates to sales information, production figures, capital
expenditures, purchase of raw materials, market trends etc.
2. Special reports – these reports are prepared according to the need of
situation. Available accounting information may not be sufficient, so data may
have to be specially collected. There may be need to put extra staff for compiling
these reports. These reports are prepared for some purposes (i.e. make or buy
decision, technological changes in industry, market analysis, changes in
government policies and so on…).
IV. On the basis of functions
1. Operating reports – these reports provide information about operations of
the concern. These reports can be classified into three types :- (a) Control
reports, which are prepared to exercise control over various operation of the
business, (b) Information report, which are prepared for facilitating planning
and policy formulation in a business, (c) Venture measurement report which is
prepared to show the result of a specific venture undertaken as for example a
new product line introduced.
2. Financial reports - Such reports provide information about financial position
of the undertaking. These reports may be prepared annually to show the
financial position for the year as in the case of balance sheet or periodically to
show the cash position for a given period as in the case of fund flow analysis and
cash flow analysis.
Other types of reports -
Physical Description Report – it describe the physical characteristics of a machine,
a device, or some other type of object. They also explain the relationship of one part
of the object to other parts so that the reader can visualize the object as a unit.
These are many times combined with process, analysis, or investigation reports.
Process Report – it explains how products are produced, tests are completed, or
devices operate by describing the details of procedures used to perform a series of
operations. Process reports may be general or detailed. General process reports are
addressed to persons not directly involved in performing the process. Detailed
process reports are designed to give the readers all the necessary information
needed to complete the process.
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Analytical Report – analytical reports critically examine one or more items, activities, or
options. This type of report usually results in conclusions and recommendations.
Examination report – examination reports are used to record data obtained from an
examination of an item or conditions. They are usually prepared for people
knowledgeable about the subject and not for the general reader.
Laboratory Report – laboratory reports record and communicate the procedures and
results of laboratory activities. Equipment, procedures, findings, and conclusions are
clearly presented at a level appropriate for readers with some expertise in the subject.
They are sometimes presented in laboratory notebooks using neatly handwritten text
and charts.
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Literature Review – literature reviews are logically organized summaries of the
literature on a given subject. It is important that they are correctly documented
and accurately represent the scope and balance of the available literature.
Design Portfolio – design portfolios are organized presentations of preliminary
and final designs of items such as mechanisms, products, and works of art. The
presentation may be in the form of notes, sketches, and presentation
illustrations.
And so on…..
 Forms of reports
☺Oral Reports – an oral report is not very popular as it does not serve any
evidence and cannot be referred to in future. Oral report may take the form
of a meeting with individuals or a conference.
☺Descriptive form – these reports are in written form they serve as a evidence
in future.
☺Comparative statement – these reports are preparing for comparison of
actual result to standard result.
☺Diagrammatic and graphic representation – under this form information
are shown in graphical forms.
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☺Break-Even Chart - This type of chart is prepared to show the relationship
between variable and fixed cost and sales. It shows the point of no-profit
and no-loss or where total cost equals total revenue received.
☺Gantt Charts - This chart was first introduced by Heny L. Gantn. It is a
special type of bar diagram under which bars are drawn horizontally. This
chart shows the bars of planned schedule and attained performance. They
are largely used to denote utilisation of machine capacity.
 Reports submitted to different levels of Management
• The reports are submitted to different levels of Management :-
1. Top-level Management
2. Middle-level Management
3. Lower-level Management
 Reports to Top-Level Management
ⱺ Top management consists of Owners, Board of directors, Managing director, Chief executive
and General manager.
ⱺ They making policies, plans and objectives.
ⱺ Some of reports needed to top management are –
1. Periodic report about Profit & Loss A/c and balance sheet to know the financial condition
of the entity.
2. Statement of fund flow and cash flows at regular intervals.
3. Reports on production trends and utilization of capacity for making production policies
and programs for future period.
4. Report about cost of production to know the cost of each element involved.
5. Reports on sales, credit collection period, Selling & distribution expenses.
 Reports to Middle-Level Management
It consists of different departmental managers such as production manager, sales
manager, finance manager, purchase manager, chief accountant etc.
It assigned the work for executing various policies framed by top management.
Reports are prepared on the basis of different departments. Such as –
i. Reports for Production manager
ii. Reports for Sales manager
iii. Reports for Purchase manager
iv. Reports to Cost manager
v. Reports for Financial manager
vi. And so on……
 Reports to Lower-Level Management
 It consists of foremen.
 They are responsible for execution of policies.
 They get daily reports from their subordinates.
 These reports may includes the following –
a. Labour utilisation reports and causes of lost time.
b. Workers efficiency report.
c. Confidential report
d. Scrap report
e. Maintenance cost expenses.
f. And so on…..
 General Format of Reports
• The mechanical format of a report consists of three parts: the preliminaries,
the text, and the reference materials.
 The Preliminaries –
a. Title page
b. Preface, including acknowledgments (if desired or necessary)
c. Table of contents
d. List of tables
e. List of Figures or illustrations
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 The Text –
a. Introduction (introductory chapter or chapters)
b. Main body of the report (usually divided into chapters and sections)
c. Conclusion
 The Reference Material –
a. Bibliography
b. Appendix (or Appendixes)
c. Index (if any)