When we talk about emerging technologies in accounting and finance, there’s the list of usual suspects: artificial intelligence, blockchain, drones, Internet of Things, virtual/augmented reality, XBRL and, perhaps, 3D printing. One topic may or may not be in your list of the top 10 tech developments, but has been hit hard and often in our world: Robotic Process Automation (RPA).
Part of the crux of the issues related to the future of corporate reporting is the nature of a “report.” Is a report something that through conventions makes browsing the information simpler and comparing two reports (either across organizations or across periods) simpler? Does breaking information into multiple interconnected reports, like a web site that gets you started and points you elsewhere as necessary, make more sense? Can the information be abstracted but standardized sufficiently for people to create their own reports that better reflect their own demands and circumstances?
Can corporate reporting be “more effective and engaging for all those with an interest” in an organization? Is technology a facilitator, and can it be a greater facilitator? And is a “feedback loop” between management and the stakeholders a necessary part of that process?
We are continuing a series of blog entries specifically about the FRC’s (UK’s Financial Reporting Council) A Matter of Principles: The Future of Corporate Reporting, a discussion paper published in October 2020 with comments requested by February 5, 2021. In this entry, we are focusing on one sentence within the principle-based document:
The UK’s Financial Reporting Council (FRC) has published a thought-leadership piece, A Matter of Principles: The Future of Corporate Reporting.[1] Does it portray the future of corporate reporting as you see it? Comments are due by February 5, 2021.
I have been trying to stir up the community to talk about materiality, primarily related to XBRL/Inline XBRL, but also related to other non-financial areas, such as Sustainability.
The executive summary for the FRC paper summarizes the discussion on materiality in this way:
“Materiality is essentially a filter for determining what information is included in a particular report. The general principle for materiality that we propose in the model is that materiality will be judged by reference to the communication objective of the specific report. We do not believe that a single definition of materiality is appropriate for all reports.”
The UK’s Financial Reporting Council (FRC) has published a thought-leadership piece, A Matter of Principles: The Future of Corporate Reporting.[1] Does it portray the future of corporate reporting as you see it? Comments are due by February 5, 2021.
Before I start in my thoughts on the paper here, I wanted to tell you (remind you) of a vision of the future that has stuck with me for a very long time. It was first presented to me at an AICPA technology conference by perennial keynote speaker Dana R. (Rick) Richardson, who strongly contributed to my own presentation style.
In 1987, Apple Inc. produced a video[2] about the interactive, personal future of computers, known as the “Knowledge Navigator.” Thirty-three years later, it is fascinating to compare and contrast the vision as detailed in the epilogue to John Sculley’s Odyssey: Pepsi to Apple with Apple’s product direction and the rest of the industry.
The UK Financial Reporting Council (FRC*) has published a thought-leadership piece, A matter of principles: The Future of Corporate Reporting (1). The 36-page discussion paper, with comments requested by February 5, 2021, “explores ideas for changes to the system of corporate reporting with a view to making it more effective and engaging for all those with an interest in a company.”
Chartered Professional Accountants of Canada (CPA Canada), one of the largest national accounting organizations in the world, has chosen to become a founding partner of ThinkTwenty20.
