scholarly journals Valuation Challenges in Stranded Asset Scenarios

2020 ◽  
pp. 157-174
Author(s):  
Posi Olatubosun ◽  
Sinem Derindere Köseoğlu
Keyword(s):  
Financial Reporting ◽  
Reporting System ◽  
Participant Observation ◽  
Intrinsic Value ◽  
Risk Society ◽  
Responsible Investment ◽  
Key Factor ◽  
The Uk ◽  
Energy Companies ◽  
Risk Reporting

This chapter investigates the challenges faced by sell-side analysts in engaging with companies with material stranded assets through the lens of Becksian risk society theory. The research unravels the usefulness of sustainability reports in deriving the intrinsic value of energy companies in the UK, and whether they take Environmental Social and Governance (ESG) factors into consideration in doing so. Qualitative data were collected via dual methods comprising longitudinal participant observation at IR meetings and interview of sell-side analysts and institutional shareholder. Findings indicate dissatisfaction with the existing risk reporting system is a key factor in divestment decisions and asset stranding. The growing Responsible Investment (RI) awareness notwithstanding, the inadequate risk reporting system continues to represent a major source of agitation amongst shareholders and analysts, making the overhaul of the current financial reporting system inevitable.

scholarly journals Incentives facing UK-listed companies to comply with the risk reporting provisions of the UK Corporate Governance Code

2016 ◽  
Vol 22 (1) ◽  
pp. 127-152 ◽  
Author(s):  
P. Klumpes ◽  
C. Ledlie ◽  
F. Fahey ◽  
G. Kakar ◽  
S. Styles
Keyword(s):  
Corporate Governance ◽  
Financial Reporting ◽  
Financial Reports ◽  
Listed Firms ◽  
Reporting Practices ◽  
Corporate Governance Code ◽  
Future Viability ◽  
The Uk ◽  
Corporate Risk ◽  
Risk Reporting

AbstractRecent changes made to the UK Corporate Governance Code require UK firms to report new or enhanced narrative information concerning their principal risks, their risk management processes and their future viability. This paper analyses whether the level and nature of voluntary compliance with these new requirements is consistent with alternative economic and political visibility incentives. We analyse relevant sections of financial reports produced by industry-matched samples of large-, mid- and small-cap UK-listed firms during the transitional 2013–2014 financial reporting years. Both specific and generic readability attributes of the reports are measured. We find that virtually no firm in our sample has provided any viability statement. Empirical analysis of disclosures concerning principal risk assessment and review processes appear to be primarily motivated by political visibility reasons. Examples of particularly good and cases of poor corporate risk reporting practices are also discussed. Possible implications for the actuarial profession are discussed.

scholarly journals The emergence of integrated private reporting

2015 ◽  
Vol 23 (1) ◽  
pp. 28-61 ◽  
Author(s):  
Jill Frances Atkins ◽  
Aris Solomon ◽  
Simon Norton ◽  
Nathan Lael Joseph
Keyword(s):  
Financial Reporting ◽  
Institutional Investors ◽  
Institutional Logics ◽  
Environmental Reporting ◽  
Integrated Reporting ◽  
Institutional Investment ◽  
Content Type ◽  
Responsible Investment ◽  
Social And Environmental Reporting ◽  
The Uk

Purpose – This paper aims to provide evidence to suggest that private social and environmental reporting (i.e. one-on-one meetings between institutional investors and investees on social and environmental issues) is beginning to merge with private financial reporting and that, as a result, integrated private reporting is emerging. Design/methodology/approach – In this paper, 19 FTSE100 companies and 20 UK institutional investors were interviewed to discover trends in private integrated reporting and to gauge whether private reporting is genuinely becoming integrated. The emergence of integrated private reporting through the lens of institutional logics was interpreted. The emergence of integrated private reporting as a merging of two hitherto separate and possibly rival institutional logics was framed. Findings – It was found that specialist socially responsible investment managers are starting to attend private financial reporting meetings, while mainstream fund managers are starting to attend private meetings on environmental, social and governance (ESG) issues. Further, senior company directors are becoming increasingly conversant with ESG issues. Research limitations/implications – The findings were interpreted as two possible scenarios: there is a genuine hybridisation occurring in the UK institutional investment such that integrated private reporting is emerging or the financial logic is absorbing and effectively neutralising the responsible investment logic. Practical implications – These findings provide evidence of emergent integrated private reporting which are useful to both the corporate and institutional investment communities as they plan their engagement meetings. Originality/value – No study has hitherto examined private social and environmental reporting through interview research from the perspective of emergent integrated private reporting. This is the first paper to discuss integrated reporting in the private reporting context.

Growing Pains at Groupon

2013 ◽  
Vol 29 (1) ◽  
pp. 229-245 ◽  
Author(s):  
Saurav K. Dutta ◽  
Dennis H. Caplan ◽  
David J. Marcinko
Keyword(s):  
Financial Reporting ◽  
Intrinsic Value ◽  
Securities And Exchange Commission ◽  
Internal Controls ◽  
Revenue Recognition ◽  
Material Weakness ◽  
Going Public ◽  
Right Of Return ◽  
Growing Pains ◽  
Financial Metrics

ABSTRACT On November 4, 2011, Groupon Inc. went public with an initial market capitalization of $13 billion. The business was formed a couple of years earlier as an offshoot of “The Point.” The business grew rapidly and increased its reported revenue from $14.5 million in 2009 to $1.6 billion in 2011. Soon after going public, prior to its announcement of its first-quarter results, the company's auditors required Groupon to disclose a material weakness in its internal controls over financial reporting that impacted its disclosures on revenue and its estimation of returns. This case uses Groupon to motivate discussion of financial reporting issues in e-commerce businesses. Specifically, the case focuses on (1) revenue recognition practices for “agency” type e-commerce businesses, (2) accounting for sales with a right of return for new products, and (3) use of alternative financial metrics to better convey the intrinsic value of a business. The case requires students to critically read, analyze, and apply authoritative accounting guidance, and to read and analyze communications between the Securities and Exchange Commission (SEC) and the registrant.

Is Hong Kong ready for accounting education reform: an analysis of tri-partite views

2014 ◽  
Vol 27 (3) ◽  
pp. 249-265 ◽  
Author(s):  
Theodore T.Y. Chen
Keyword(s):  
Hong Kong ◽  
Education Reform ◽  
Financial Reporting ◽  
Accounting Education ◽  
Accounting Firms ◽  
Content Type ◽  
The Usa ◽  
Accounting Practitioners ◽  
The Uk ◽  
Big Four

Purpose – The purpose of this study is to determine whether Hong Kong is ready for accounting education reform. Design/methodology/approach – The approach for this study is using a Likert-scale questionnaire for the academic institutions, the Hong Kong Institute of Certified Public Accountants and the big four accounting firms, followed by detailed follow-up interviews with each. Findings – There is general agreement among accounting academics and the profession that the Accounting Education Change Commission initiatives should be adopted in Hong Kong. Hong Kong accounting academics in public institutions do not oppose to a balance between teaching and research, but would oppose to an emphasis of teaching over research. This is important as an overemphasis on research could mean less time for teaching and curriculum development. The big four accounting firms are either happy with the way Hong Kong universities have been educating the accounting graduates or have no complaints against them. This is also important as an urge for accounting education reform usually comes from the practitioners as in the USA. Originality/value – The USA was the first country that saw the need for accounting education reform as accounting practitioners felt that curriculum and pedagogical considerations placed heavy emphasis on the technical aspects of accounting at the expense of a general, broad-based education. Similar needs for change were also found in the UK and Australia. As Hong Kong is one of the world’s major financial centres with a large securities exchange, there is a great deal of emphasis on accounting standards, financial reporting, corporate governance, etc., and hence the importance of accounting education. Is Hong Kong ready for the change?

Diffi cult Issues of Equity Accounting

Auditor ◽  
2021 ◽  
Vol 7 (1) ◽  
pp. 37-41
Author(s):  
N. Mislavskaya
Keyword(s):  
Financial Reporting ◽  
Reporting System ◽  
Professional Community ◽  
Financial Statements ◽  
Critical Assessment ◽  
Financial Reporting Standards ◽  
Theoretical Approaches ◽  
Diffi Cult ◽  
Fixed Assets ◽  
Mandatory Use

The article, based on a retrospective analysis of theoretical approaches to the concept of capital, examines the legality of its reflection in the accounting (financial) reporting system. The dilemma of an organization's choice of an accounting policy for the revaluation of fixed assets or the mandatory use of it, discussed today in the professional community, justifies the democratic approach used in international financial reporting standards in the author's reading. Critical assessment refers to the methodology for reflecting the revaluation results on accounting sets and in the forms of accounting (financial) statements.

Delivering fuel poverty objectives within the context of globalised energy markets

2017 ◽  
pp. 85-102
Author(s):  
Carolyn Snell
Keyword(s):  
Lower Energy ◽  
Energy Markets ◽  
Energy Prices ◽  
Global Energy ◽  
Policy Makers ◽  
Efficiency Measures ◽  
Policy Measures ◽  
Policy Direction ◽  
The Uk ◽  
Energy Companies

This chapter explores claims made by policy makers in the UK that, despite having no control over global energy markets, existing policy protects households vulnerable to fuel poverty through the regulation of commercial energy suppliers and specific policies that provide cash transfers and energy-efficiency measures. Keeping energy prices low is an essential part of the UK government's approach to fuel poverty alleviation, but this task is a complex one in which the steering capacity of the nation-state often seems weak and its capacity hollowed out. This is exacerbated by a neoliberal policy direction that funds environmental and social policy measures through charges on energy bills rather than through tax-funded programmes. The chapter then argues that existing policy has been somewhat contradictory in its view of the government's power to steer energy markets. While the Department for Energy and Climate Change suggested that the UK has no control over the global energy market, this does not match political rhetoric, which has emphasised the importance of increasing domestic energy security in order to spread risk and reduce dependence on politically unstable fossil fuel-producing states, and has also seen political pressure placed on the six main energy companies to lower energy charges to consumers.

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