A survey by the Accounting and Corporate Regulatory Authority (ACRA) of Singapore and the Association of Certified Chartered Accounts (ACCA) has found deficiencies in the financial reporting practices of Singaporean companies.
The survey suggested that companies should "take ownership of financial reporting" and devote more resources to develop effective financial reporting systems.
According to the survey, 50% of the 400 accountants who participated in the survey seemed to believe that the primary responsibility for financial preparation fell more on auditors than on them.
A focus group, which was run concurrently with the survey, also found that some company officers are not fully engaged in financial reporting because they see it as a compliance exercise, and many rely on auditors regarding this task.
Frequent changes and the increasing complexity of financial reporting standards are thought to pose significant challenges to financial preparers, the survey revealed.
Survey respondents and focus group participants identified several measures to raise the quality of financial reporting, among others:
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By GlobalData- Employing and retaining qualified accountants in the finance function;
- Regular training for the finance team as well as for the board directors and management;
- Funding for new technological support and professional assistance; and
- A change of focus from top management to recognise the importance of external financial reporting.
"These survey findings underscore the pressing need to re-examine the responsibilities of each member of the financial reporting eco-system. Directors, audit committees, preparers and auditors must work with regulators to uphold investors’ trust and confidence in our market," ACRA chief executive Kenneth Yap.
Related links
The Accounting and Corporate Regulatory Authority
Association of Certified Chartered Accounts