8 Conflicting objectives in financial reporting
Conflicting objectives of reports
Maximising profits, maximising shareholder value – such concepts make for neat theoretical economic and financial models that are easy to manipulate and obtain solutions. However, they are too simplistic for real life firms. Many of the recent developments in financial and corporate reporting can best be explained as the outcome of a struggle between the proponents of different concepts of the function of the annual report. That said, internal reporting systems can be incorrect, misleading, manipulated, or inadequate (à la Carillion, Patisserie Valerie, and others).
For most readers of annual reports, the remuneration report is glossed over. The detailed directors’ ...
