The Interconnection Of A Company 's Financial And Non Financial Elements

The Interconnection Of A Company 's Financial And Non Financial Elements

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Introduction


Definition

“An integrated report is a concise communication about how an organization’s strategy, governance, performance and prospects, in the context of its external environment, lead to the creation of value over the short, medium and long term.” (International Integrated Reporting Framework p7)

Why IR?
It outlines the interconnection of a company’s financial and non-financial elements and aims to combine them and show value creation and maintenance. It identifies resources and their effective and responsible usage. It intends to create a dialogue between the shareholders and other stakeholders and provides them with detailed information.


The main idea of integrated reporting is to create one concise, consistent and continuous report that provides an integrated message to everyone.



Guiding Principles
An IR needs to provide an understanding of the company’s strategy, the way the information is dependent and interrelated, to show the relationship with stakeholders and how it responds to their interests and information about value creation. The report needs to be concise, reliable and complete and consistent.

Content Elements
The IR must outline what a company does and how it operates, what the governance structure is, what its business model is, what are the risks involved in value creation, how it is dealt with and the future direction of the company, it’s performance and the challenges it faces. The information provided should be quantified and evaluated.



Why Amcor?

Amcor and Integrated Reporting
Although in two reports, an annual report highlighting the financial aspects of the company and a GRI based sustainable report highlighting the socio-economic and cultural aspects, Amcor ...


... middle of paper ...


...uld have a financial impact on Amcor.

Financial Risk

It specifies that availability of funds is a needed to meet the business’ requirements and how the change in currency value or interest rates can affect vulnerabilities.

Customer Risk

The suppliers of raw materials play a key role in the business functions and these strong relationships could cause a huge impact on the financial performance if they fall out.

Competitors Risk

Amcor being a global market holder, has various competitors with huge barriers and their strategy or growth can affect its financial performance.

Other risks
Merger acquisitions, Talent retention, Country risks, Supply chain risk,

Change in consumer preferences, compliance risk, tax risk and product safety risk.



All these risks have been addressed in depth and have been provided with measures taken to avoid them.

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