Essay Title: 

Narrative Reporting

April 3, 2016 | Author: | Posted in accounting, mathematics and economics

Narrative Reporting

Narrative reporting and introduction of OFR is an important development in corporate responsibility . The introduction of mandatory OFR made several companies race to meet with the requirements of the law Subsequently , the OFR was made non mandatory again but awareness has been created . Every investor knows that he should look at the OFR of a company he seeks to invest in . If the OFR is missing it raises doubts about the credibility and the intentions of the company .In future even though the mandatory clause has been withdrawn , companies are [banner_entry_middle]

likely to produce more comprehensive and informative OFR than ever before

Narrative reporting concentrates on presenting events and actions in certain so that complications and problems are understood Narrative reporting concentrates on the s , events and facts that pertain to events , identifying the personnel who are involved and the manner in which the sequence of events took place . The OFR (Operating and financial review ) is a report included in a company ‘s annual report and accounts that is published to meet the requirement of corporate governance that enumerates the operating activities and financial affairs of the company

In the UK the Operating and Financial Review was introduced with the purpose of increasing corporate responsibility . The purpose of this requirement was that social and environmental issues would be described in the OTR and this would provide a wider level of information to the shareholder . In addition , it was expected that the OTR would in a way compel companies to carry out external audit of these issues Specifically it was intended that the OFR would provide better information to the investors on the likely performance of the companies during the financial year

The contents of the OFR should have an overview of the capital structure of the company and the financial characteristics of the company . In addition , the OFR was required to provide the main risks and uncertainties that faced the company . Further , the OFR was required to have s of the brand strength , market strengths , company reputation and R D , that is the resources that the company enjoyed in the market . Most importantly , the OFR required the companies to disclose the objectives and strategies of the company (Financial Reporting Council 2007 . The OFR also required the companies to disclose its relationships with suppliers , customer and employees . In other words the company was required to disclose its relationship with the stakeholders of the company . The company was also required to comment on the reputation of the company , especially in relation to the society and the environment . Moreover , the company was required to comment on the impact the reputation would have on the future performance of the company (Yeldar . R . 2007

In the UK the OFR disclosures have been left to an extent to the directors of the company . Their views on the different points are critical in making the disclosure useful to the company . Moreover , the government has focused on the OFR to fill the lacunae in reporting that… [banner_entry_footer]


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