Evolution of Corporate Reporting and Emerging Trends

Published date01 May 2016
Date01 May 2016
© 2016 Wiley Periodicals, Inc.
Published online in Wiley Online Library (wileyonlinelibrary.com).
DOI 10.1002/jcaf.22157
Evolution of Corporate Reporting
and Emerging Trends
Ali Uyar
Corporate scan-
dals erupting in the
past two decades
have shaken inves-
tor confidence in the
capital markets. In
order to restore this
confidence, regula-
tory bodies have
taken some steps to
alleviate some of
this skepticism in the
minds of the users
of financial reports.
These regulations call
for more transparency and bet-
ter corporate reporting. Cor-
porate reporting is to disclose
financial and nonfinancial
results of a company to stake-
holders periodically by the use
of various tools. It used to con-
sist of only financial data until
the 1980s since the reporting
process was covering the pre-
sentation of financial informa-
tion and their complementary
footnotes. Nowadays, corporate
reporting includes nonfinancial
information along with finan-
cial data. Therefore, the utiliza-
tion of a more comprehensive
“corporate reporting” con-
cept is gaining momentum
which signifies a more holistic
approach in external corporate
Corporate reporting is
important for effective func-
tioning of capital markets
since the information disclosed
in these reports are primary
inputs for decision making
by investors and others with
vested interests such as lenders
and dependent customers. The
subject is particularly signifi-
cant for emerging markets since
they need to attract foreign
capital to finance
growth. More trans-
parency through cor-
porate reports opens
the way for capital
flow. Particularly in
the past two decades,
corporate reporting
has been undergo-
ing a transformation
from several per-
spectives: contents,
reporting tools, tar-
get audience, report
types, design and so
on (Exhibit 1). Thus,
the evolution of cor-
porate reporting is elaborated
from these perspectives in the
following paragraphs based on
the work of Uyar (2015).
The contents of corporate
reports have undergone a tre-
mendous change; particularly,
nonfinancial reporting has
improved a lot in the past two
decades. In addition to finan-
cial information, disclosure
of nonfinancial information
is the trend among business
organizations. Reporting of
Corporate reporting is undergoing a tremendous
evolution; it is evolving from mere financial report-
ing to including both financial and nonfinancial
information. The improvement in corporate report-
ing is of importance for all stakeholders since it
enables a reporting entity to become more trans-
parent and accountable. Particularly, in the last
two decades, corporate reporting has been under-
going a transformation from several perspectives:
contents, reporting tools, target audience, report
types, design, and so on. Thus, the evolution of
corporate reporting is elaborated from these per-
spectives in this article. © 2016 Wiley Periodicals, Inc.
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