Dan Brännström

Personligt om näringsliv och samhälle

Etikett: One Stop Shop (Sida 1 av 4)

High time to re-invent the corporate reporting framework

Please find below my speech from the Sustainable Business, Reporting and Assurance Conference (SUBREA) in Lund on November 16th 2017

Good afternoon everyone! My name is Dan Brännström and I’m Secretary General at FAR – the Institute for the Accountancy Profession in Sweden.

My starting point will be how global market changes really do challenge today’s corporate reporting. I’m talking about ever-increasing expectations on transparency, sustainability and serving the public interest. In addition, there is the increased importance of non-financial information and integrated reporting – one way or the other.

Furthermore, new technology is expected to lead to major changes in Corporate reporting. Real-time reporting and auditing is no longer unreachable science fiction. Bolagsverket, the Swedish Companies Registration Office, and its Nordic equivalents are presently working on a concept they call Smart Government. This project is aiming at submission of financial and other information directly from the companies’ systems to one appointed authority, one-stop-shop if you like. And this shall take place in real-time.

One question in particular comes to mind – will there still be a need for annual reports when this becomes reality?

All this means that the organization and processes for the standard-setting in both reporting and auditing must be thoroughly re-invented. In addition, initiatives from one standard-setter must be better synchronized with others.

However, preparers are struggling on. We can see that the quality of financial reports and other corporate reporting is improving every year. Sweden is on top, maybe even the best. For those of us involved in arranging awards for the best financial statements and sustainability reporting this is quite obvious. The financial statements are however becoming far too voluminous. For the 2016 annual reports the average number of pages increased by 4 from 94 to 98 pages for companies listed at Nasdaq Stockholm. The thickest annual report was, in fact, all of 248 pages!

Is anyone really able to digest such a thick document? Corporate reporting must be readily available for different stakeholders.

All I’ve said so far points to a need for a totally new framework or standard setting, since today’s concept is clearly inadequate. Such a framework should focus on what is really creating value.

I’m talking about a totally new corporate reporting that includes both financial and non-financial information in an integrated manner. All the time with the focus on value-creation. And I guess that you could pick up a lot from the proposed framework for integrated reporting (IIRC).

More and more frequently I hear requests in the market place for a more standardized reporting on sustainability, this in order to make that reporting comparable between companies and hence a better basis for decisions. And I believe sustainability aspects will continue to become more and more important and decisive for all stakeholders.

Well, I’m not sure what you think, but my view is that we can’t go on with this current standard setting where IASB is the standard setter for IFRS and GRI, and up to a thousand others are sources for guidance on sustainability reporting. To me it’s absolutely clear that U2 is right – “we still haven’t found what we’re looking for”.

Furthermore, we have the IIRC for integrated reporting.

If we want corporate reporting to be relevant and to focus on value creation it’s high time to re-invent the standard setting process. And I’m not talking about an add-on to IFRS. My conclusion is that IFRS and other standard-setting must be replaced by a totally new framework.

In doing this, we must aim at making the reporting sufficiently accessible. In this context a paper from Accountancy Europe, including a “Core & More”-concept could be a basis for further development. The concept comprises a summary of business activities – that’s the Core part. In order to meet market demands, this should be prepared in a rather standardized format. It shouldn’t be too voluminous. Maybe 30-40 pages. Everyone can manage to read that.

In addition to this, there is in-depth information available regarding areas such as sustainability, risk, internal control and detailed financial information – that’s the More part.

Obviously, we should apply new technology to – as far as possible – make reporting accessible in real-time. This means, as mentioned earlier, that the annual report will become less significant.

What about audit or assurance on this new, let’s call it integrated corporate reporting?

There are all kinds of possibilities. Anything that is measurable can be subject to audit or assurance. And everything in this world is in fact measurable. I’ve learnt that from working together with technical researchers at the Swedish Research Institute RISE.

At least, the Core-part is the part that ought to be subject to audit or assurance. In doing this the auditor must apply an overall view. That reminds me of the fact that audit is closely related to the word audition – you can almost hear that – which means listening, observing and then setting a grade.

The auditor of tomorrow must be able to make a statement on this kind of integrated corporate reporting. And that will greatly contribute to a reliable, relevant value-creating reporting. In real-time.

Thank you for listening!

6 kommentarer

Svårt att göra enkelt?

Mitt i semestertider lanserade näringsminister Mikael Damberg ett förenklingspaket för företag. Bland annat får Tillväxtverket i uppdrag att utreda dels hur ny teknik kan nyttjas för att skapa bättre informationsutbyten mellan myndigheter, dels hur olika handläggningstider kan kortas.

Detta är lovvärt, men jag har mina dubier. När det gäller informationsutbytet mellan myndigheter fick Bolagsverket m.fl. ett liknande uppdrag hösten 2011 av den dåvarande regeringen. Visionen om ett förenklat uppgiftslämnande till myndigheter och ”En uppgift en gång” (eller ”One Stop Shop”) har därför funnits länge nog. För att detta ska bli verklighet måste vi dessutom tillämpa elektronisk ingivning av årsredovisningar, men alla försök och utredningar till trots är detta ännu inte på plats i Sverige. Det tycks vara svårt att göra det enkelt, men enkelt att göra det svårt …

Sedan funderar jag på om vi verkligen behöver fler utredningar på samma tema. Det som krävs är beslut, inte mer information. Jag har sagt det förut och jag säger det igen: Sätt ner foten, Mikael Damberg.

FAR:s branschdagar tar vi självfallet upp behovet av förenkling, bland annat genom en spännande dialog med Regelrådets ordförande Pernilla Lundqvist och näringsdepartementets statssekreterare Niklas Johansson. Här behövs din röst, så missa inte att anmäla dig!

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Den största förenklingen

Tillsammans med XBRL Swedens ordförande Björn Rydberg och XBRL Internationals CEO John Turner.

Tillsammans med XBRL Swedens ordförande Björn Rydberg och XBRL Internationals CEO John Turner.

Så går ännu en arbetsvecka mot sitt slut. Jag tar bland annat med mig hoppet om att Sverige inte bara ska komma ifatt omvärlden utan också ta täten när det gäller digital rapportering.

I tisdags arrangerade XBRL Sweden ett välbesökt seminarium om digital rapportering (eller Standard Business Reporting, SBR, som det också kallas). På scenen fanns även internationella talare som kunde vittna om alla fördelarna med digitala rapporter och flöden. På min fråga om Standard Business Reporting också passar det växande inslaget av icke-finansiell information, exempelvis om hållbarhet, svarade John Turner, CEO för XBRL International, jakande.

Som jag bloggat om tidigare är det mycket positivt att regeringen har gett Bolagsverket i uppdrag att införa digital hantering av årsredovisningar. Digital rapportering förenklar, effektiviserar och höjer kvaliteten – det är min bestämda uppfattning. Men det kräver tvingande lagstiftning för att genomslaget ska bli det önskade.

Jag vill samtidigt hålla fast vid förhoppningen att Sverige borde bli först i världen med One Stop Shop som ju dramatiskt skulle underlätta företagens omfattande uppgiftslämnande till olika myndigheter. Jag har faktiskt svårt att tänka mig en större förenkling för företagen. Tekniken är på plats och att döma av seminariet i tisdags finns också viljan. Så vad väntar vi på?

PS: Ta gärna del av Balans reportage från seminariet och filmer med olika intressenter

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