Current financial reporting model of the existing problems and improvement measures

[Abstract] Innovation in financial markets, giving enterprises great risk and challenges. It was discovered that the current financial reporting model there are many problems, we must examine these issues, take corrective action in order to maintain the authenticity and authority of financial reporting .

[Keywords:] measures the current financial reporting issues

Innovation in financial markets, to the enterprise at great risk and challenges. It was discovered that the current financial reporting model there are many problems, we must examine these issues, take measures for improvement of financial reporting in order to maintain the authenticity and authority.

First, the current financial reporting model problems
1. Incomplete financial disclosure report. To form a historical accounting data and decision-making activities, the asymmetry between the future. This is not a complete accounting information will become the main cultivation of the market, supporting development of non-market system ignore the obstacles to good use statement users can not report information to make the right scientific decision-making, is an urgent need of financial reporting, "Capacity", to expand the content of information disclosure, improve the information model. Second, the current financial reporting model to focus on hard assets. but in some high-tech enterprises and large enterprises, intangible assets, the proportion of total assets and the role can not be ignored. However, the traditional financial report can not adequately reflect this and thus can not effectively meet the information needs of users in decision-making based on intangible assets.

2. Not timely disclosure of financial reports. The current financial reporting requirements for year-end statements reported out within 4 months, interim reports quoted within 2 months. This is no longer out of date information or even harmful to help decision making, information disclosure is not timely will increase the external users of accounting information in decision-making risk. Therefore, in order to meet the information needs of users, providing a shorter period of external financial reporting to become a top priority.

3. Disclosure is not enough reliable financial reports. Some companies have a good operating performance, often drilling policy loopholes, the use of accounting standards to control the ambiguity on the financial data to whitewash report, reducing the reliability of the report.

4. Not forward-looking information disclosure of financial reports.

Second, the existing financial reporting should be improvements in the following areas
In order to timely respond to such complex economic environment, I think the current financial reporting should be the following improvements:
1. To expand the content of information disclosure, appropriate increase in statements to reveal non-financial information. To expand the scope of the report, the first increase in derivative financial instruments reveals that the derivative financial instruments included in the table, the full disclosure of its value, return and risk transfer , potential risks and the impact on the financial statements. Secondly, we should increase the resources of human assets is recognized in the current accounting system, investment in human costs of all spending, which makes the human assets have been greatly underestimated, but which costs a substantial increase This is also the knowledge economy can not adapt to the current financial report, the information needs of the times, being the main reason more and more questioned. address the recognition and measurement of human resources, human resources, in addition to further study the theory and method of measurement, but also involves to human capital issues, and the resulting distribution of benefits and other issues, should be a topic of accounting disciplines to accelerate Research. Second, increase the financial statements. in accounting developed countries, the accounting statement is almost the length of the report itself 5 times Note the position from which you can see. In contrast, our current financial statement is still at the stage of the main content of the report. so appropriate increase in statements to increase sheet items, such as long-term purchase agreements, and intellectual capital and human resources Disclosure of information in order with the world, to better serve the users. improve information model, in accordance with the idea of widening the structure of accounting information, financial reports should include at least the corporate financial information and non-corporate financial information (such as business performance information) of two major . This requires the provision of corporate financial reporting is not limited to the balance sheet, income statement and cash flow statement, it must be comprehensive and reflect the business process the system formed by all financial and non-financial information.

Links to Research Papers Download http://www.hi138.com 2. Preparation of real-time reporting, reduce the reporting time interval and improve the timeliness of financial reporting. The current reality is that enterprises are facing shorter product life cycles, derivatives are emerging , the uncertainty of business activities increasingly significant, decision-useful accounting information of significantly reduced. alone in the past month, the annual accounting report prepared at the time the report can not satisfy user's needs. because, therefore, must be established provide timely information of a financial reporting system. On the one hand, regular reports will continue to exist as a basis for allocation of financial results; the other hand, the preparation of solid into the report as a decision-making. This is done not difficult, because the account financial reporting data into the process complexity of data operations, has been incorporated as a personal computer algorithm program, accounting personnel, accounting treatment is completed, the computer can automatically generate reports. So, with the development of information technology to improve the timeliness of financial reporting and sufficiency, no longer have technical problems.

3. Establish a sound supervision system of internal accounting controls. In order to ensure a true and complete accounting of accounting information, in addition to improving their own quality of accounting personnel, but also need to build build enterprise-wide system of internal accounting controls, not only rely on corporate accounting office and accounting staff for their efforts to complete, but also organizational units by the unit responsible authorities and relevant personnel involved in the internal control system is established and implemented.? same time to strengthen the internal audit work to enable effective operation of internal control systems to ensure the safety and integrity of corporate assets, financial report the true and reliable. In short, good internal control system can play the role of monitoring in advance and reduce the chance of mistakes and reduce the probability of financial fraud. sound internal audit mechanisms, enterprise system can detect loopholes in the operation, to avoid errors and fraud, reduce business losses.

4. To increase the disclosure of information on future projections. For information on the user's decision, the company's future is the most important information. As detailed as possible through the financial and accounting reports to disclose the value of the future trend of business information, such as market share, material the cost of lifting rates, new product development, profit forecasts, corporate credit rating and other information for users of the report forecasts business trends to provide better services to attract more capital and investors to expand our business, achievement of higher goals . From a practical point of view, many countries requested to prepare a complete financial report projections, forecasts for the users of corporate financial reports provide useful trend of the future value of information services to improve the overall usefulness of financial reporting. while many of our accounting information users, especially entrepreneurs, the accounting information may be just a bunch of can not read the numbers. therefore, requires the improvement of information disclosure, such as enterprise information can be networked with the computer network through the network to adopt a flexible approach to information users various comprehensive and detailed accounting information in order to fully meet the different types of information users need and use of information on the differences and preferences.

It should be noted that the expansion of the financial reporting model, a large number of sheet to increase disclosure of information, accounting standards must be introduced to regulate the government's premise, but have followed an independent audit to improve and increase the audit of the forward-looking information to uncertain due provides anti-enterprise information into litigation crisis, but also to prevent corporate management manipulation of accounting information.

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