INTERNET FINANCIAL REPORTING
(DR. MOHAMMAD GABER GHANEM)
I. Definition of internet:
The internet is a global system of interconnected computer networks that use the standard protocol suite to serve billions of users worldwide. It is a network of networks that consists of millions of private, public, academic, business and government networks of local to global scope, that are linked by a broad array of electronic and optical networking technologies.
The development of internet increased the possibilities to manage business information, not only for internal purposes of companies , but also for external ones , and offered new ways of ...view middle of the document...
III. Traditional System vs. the New Technology
Before engaging in financial reporting on the net we must pay attention and highlight on the traditional way of reporting to understand the difference between these two methods. Traditionally, financial reporting by corporations was in print format and annual reports were mailed to users of financial statements. Financial information was also released to media by way of press release. Before the availability of financial reporting on the net, users of financial statements depended on the hard copies (print) of annual report to reach them. Not everyone had the ability to reach and obtain financial info so they relied on analysts and libraries for getting information.
Internet financial reporting refers to the use of the firm’s websites to disseminate or provide information about the financial performance of corporations, in this approach, firms are using the internet to market their companies to decision makers. the use of the internet by companies for the purpose of reporting manage from the unsophisticated use of internet technology , where the printed financial statements are duplicated in electronic format to a more innovative approach , where shareholders are addressed in audio formats , real time monthly sales figures and annual general meetings are planned on companies websites.
IV. Precautions to consider:
1- What to report?
2- When to report?
3- How to report?
4- Who is responsible for the reporting?
1-what to report?
In this approach we have to consider both coverage and depth of internet financial reporting.
a- Coverage :
What type of information should the firm reports online?
1- Annual reports
2- Interim reports
3- Annual and interim reports
- And we must discuss to which extent these types of financial information are adequate and sufficient for the variety of users.
An annual publication that corporations provide to shareholders to describe operations and financial conditions. It is a comprehensive report on a company’s activities throughout the preceding year. Annual reports are intended to give shareholders and other interested people information about the company’s activities and financial performance. Most jurisdictions require companies to prepare and disclose annual reports, and many require the annual report to be field at the company’s registry. Companies listed on stock exchange are also required to report at more frequent intervals (depending upon the rules of the stock exchange involved).
Typically annual reports will include:
* Chairperson’s report
* CEO’s report
* Auditor’s report on corporate governance
* Mission statement
* Statement of directors’ responsibilities
* Financial statements including:
* Auditor’s report on the Financial statements
* Balance Sheet
* Statement of RE
* Income Statement
* Cash flow statement
* Notes to...