Question

What is integrated reporting and why does it matter?

Answer 1

Solution. When an organization operates in today's competitive economic market in order to sustain it encompasses various processes. Integrated reporting is one value creation process through effective communication among internal and external users to strengthen confidence and value by incorporating all the financial and non-financial aspects of an organization developing long-term benefits.

Following are the reasons for its importance or why it matters in today's time:

1.It encompasses all the six listed capitals- financial, non-financial, intellectual, human capital, etcetera aspects of an organization while reporting to develop long-term strategies to survive and meet objectives.

2.It strengthens external users confidence while investment decisions.

3.Integrated reporting helps in generating relationships amoung different capitals employed in a business in addition to regular financial reporting reflection and stands as an advantage over competitors.