A clearer picture: enhanced business reporting: better info means better decisions.

• Author: Boudreaux, Caroline C.
• Position: BUSINESSREPORTING

Adept organizations use historical information and real-time indicators that are predictive in nature to manage their day-to-day operations and make strategic decisions. And technology has provided access to more timely, accurate and relevant information in a cost-efficient manner.

Enhanced business reporting meets the need for better, more structured guidance on reporting financial information.

LEADING THE EFFORT

The Enhanced Business Reporting Consortium is working to improve the quality of information in a cost-effective and time-efficient manner. Members will collaborate to develop a voluntary, global disclosure framework designed to be the "gold standard" in business reporting.

In addition, the AICPA Special Committee on Enhanced Business Reporting established the Public Company EBR Task Force and the Private Company EBR Task Force to research and develop examples of how enhanced business reports may appear.

Sample reports by both task forces, available at www.ebr360.org/ContentPage.aspx?ContentPageId=8, show potential approaches to enhanced business reporting and demonstrate the benefits for stakeholders.

The reports also provide sample disclosures for a number of industries, as well as how to apply XBRL and other business reporting technologies.

Key issues identified in the public company sample reports include utilizing the web to deliver information; allowing users to clickthrough for more report details; providing a range of estimates rather than a single number in reporting earnings projections; and leveraging XBRL to help users identify the financial information most relevant to them.

Key features of the private company sample reports include providing more information about the key drivers of value for the company and management's observations regarding trends in those value drivers; using the direct method to present the statement of cash flow to better indicate underlying fundamentals about the flow of cash; and utilizing XBRL.

In developing its enhanced business reporting guidance, the AICPA's Private Company EBR Task Force also designed an online survey for preparers, creditors, business owners and other stakeholders about the relevance, usefulness and effectiveness on the components of the sample reports.

The feedback will be used to develop a voluntary enhanced business reporting framework for privately held companies.

The survey is available at http://websurveyor.net/wsb.dll/20058/enhancedbusinessreporting1.htm.

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