Question

Report-writing is considered one of the essential functions of the accounting profession. Why? A good report-writing style needs to comply with some basic principles. Identify these principles and, in respect of each, summarise its main features.

Answer 1

Answer :

Report writing acts like a progress card for a company. The officials of the company can track the progress of the company, identify the areas in which it is lacking, whether the company is following proper processes. Report writing helps the company identify its strengths,weakness, helps in proper decision making etc. It also helps in attracting the investors for investing in the company. Report writing is considered as an essential function of accounting profession :

1. Provides information as on a particular date :

A report is always made for a particular period. It covers everything (important aspects) which needs to be reported as of that date.

2. Reports can be made as per situation :

Sometimes, reports are made seeing the situation. For instance, a particular aspect is identified in auditing which urgently needs to be reported to the management. In such a case, a report called "Flash " report is used to report only that important part immediately.

3. Reports for various levels :

A report when made should be clear as to for whom is made to be addressed to. For example : there is an internal report prepared for management which is circulated within the organisation & a different report is prepared for stakeholders which is circulated in public. So, it is very important to identify the matters to be reported to a particular class properly.

4. Helps management in decision making :

A report writing can make the management aware about the current situation of the company. It may help management in identifying whether new projects can be started or debt can be raised, whether more advertising expenditure can be incurred from the past growth of the product market in which it deals, whether to accept or reject a deal etc. Also examples as to whether a particular merger or acquisition can be made based on the findings of the report.

5. Inshort, a report writing is an essential closing step for any process. It helps to bridge the gap between target set and targets actually achieved. A accounting process when carried out such as journal, ledger, etc needs to be reported to analyse the proper position of the company as on a particular date for a particular period. For instance, reports in accounting can be prepared such as BRS,Accouunts Payables & Receivables report, Internal audit report, P & L Statement, Balancesheet , Tax audit, Statutory audit report etc.

A good Report writing style needs to comply with some basic principles, such as :

1. Writing to the point :

A report writer must be very clear as to what matter he is reporting. He should not take the topic in writing to other topics which are not related. A writer's personal opinion should be avoided in the report.

2. Format : There is not a specific format as such for every report. But, the report should be always tried to be made in a format which professionally resembles the matters to be communicated.

3. Introduction of the report must state the problems which are being addressed.Right and accurate information must be communicated. A false information will invalidate as well as cause loss to your organisation, as people take apt actions from facts in the reports.

4. A report should not be too big. It has to precisely report all matters. Where a report is too long, the users might find it difficult to complete reading it within time causing them boredom. It should be written in such a way that users can easily read and understand it.

5. Report should be audience specific: Before a report is prepared, the scope of it is defined. The people to whom the report is to be made are needed to be identified. For instance : There will be a different report for top level managers and a different report for stakeholders.

6. Sometimes, it is important to state the principles and methods used in preparing the report. Those should be properly stated.

7. A report writing is not a guarantee of future survival of the company , its going concern. It just reports as to findings as on a particular date for a particular period. It is just made to find out how much progress a company has made & how much efforts it needs to make to achieve further goals.

8. A report writing must be done by writer who has an independence, implies that report is made being unbiased, report is not made out of pressure from any one. Report is made after obtaining a free consent from the person writing report.

9. Report should be completed on time.