Raja Senanayake of Smart Media in his keynote address on April 2, at the Chartered Accountants of Sri Lanka event on integrated reporting said, “To me, integrated reporting is the communicating story of value creation in a sustainable manner in the short, medium and long term. It has to be creating value for all stakeholders. Integrated reporting cannot do anything better than what the entity does.”
Senanayake said, “we create the annual report with a compliance mindset.”
“They are done to the letter of the law if not its spirit.” Senanayake later added, “The accounting fraternity would have to define the concept of going concern. It is not merely the availability of resources.” He went on to explain potential business failures through competition, technological change and damage to brand image.
Senanayake said, “Unless corporate entities start practicing integrated thinking with integrity, integrated reporting could be used to cover up their misdeeds.”
Ranjani Joseph, KPMG, said, “Most of the annual reports are a combination of GRI framework with integrated reporting. That is where we see a lot of duplication. How much of that information is really useful?”
Joseph added, “How are we going to issue an assurance report when the information is collated manually and you can’t have an audit trail.” Joseph said, “there are a lot of annual reports that take nice statements and good diagrams from various overseas annual reports and report it in the local reports.”
Joseph said “We are using SLSAE 3000, a limited assurance report, based on GRI framework. In Sri Lanka, I am yet to see an assurance report on integrated reporting as we don’t have a framework to refer to.”
Joseph said in regards to internal systems, “we are so used to capturing financial information to our systems; we don’t have proper systems to capture non-financial information.” Joseph added, “there is another type of limited assurance given on selected financial and non-financial information. This information has been measured according to the criteria you (the company) set.” Aruni Rajakarier, SheConsults, said “the integrated reporting framework gives you the license to define your own capital. This year’s HNB and NTB report you see that they have reported on digital capital.”
Rajakarier added, “(the banks) have the most evolved risk management in the country at present because very few organizations have a dedicated risk department but what happens is they are looking at BASEL risk and that may be very different to material matters.”
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