The International Integrated Reporting Council (IIRC) (previously the International Integrated Reporting Committee) was formed in August 2010 and aims to create a globally accepted framework for a process that results in communications by an organisation about value creation over time.The IIRC brings together a cross section of representatives from corporate, investment, accounting, securities, regulatory, academic and standard-setting sectors as well as civil society. It comprises a Steering Committee, a Working Group and a three taskforces (dealing with content development, engagement and communications, and governance).The IIRC is chaired by Professor Mervyn King, Chairman, King Committee on Corporate Governance and Former Chairman, Global Reporting Initiative.
Membership includes Hans Hoogervorst (IASB Chairman), Leslie Seidman (FASB Chairperson), Maria Helena Santana, (Chairperson, IOSCO Executive Committee), Göran Tidström (IFAC President), Jim Quigley (former global Chief Executive Officer of Deloitte), and many others. Paul Druckman is Chief Executive Officer.The Utilitarianism theory is a theory of simple view,consisting of the common right and wrong judgement of the business decisions. Thevalue of which can be determined by conducting a cost vs.
benefit analysis ofall the decisions taken. As per this theory, the good as well as the bad aspectsof a decision should be measured in order to determine if it’s viable or notand as long as an action or decision is proving to be more good than the bad,it is deemed to be viable. This theory follows the simple principle that allthe actions have equal intrinsic good or bad aspects and in order to adoptthem, they must be objectively analyzed and studied for the overall consequenceof an action. The dash theory, this particular theory advocates that any decision that leadsto good results is right, even if it was made for the wrong reasons, and itseparates the right actions from the right moral decision. For one followingthis theory, making a right moral decision means that they must make a decisionthat will be leading to a good result.
What they must do here is that they mustevaluate on basis of the consequences of an action and after the analysis theymust choose their next steps accordingly. The institutions must therefore evaluatethe positive and negative aspects of an action in order to determine if it’sright or wrong, and as long as an action is proving to be more positive ascompared to the negative consequences, it can be deemed to be right. Followingthe Utilitarianism theory can help all institutions as it is the simpleprinciple that all the actions or decisions have both good or bad effects andthey must be carefully analyzed and evaluated in order to deduce the overall consequenceof an action. Behaviouraccounting or human resource accounting is a form of accounting that the manyinstitutions and organisations follow in order to utilize the most abundant recourse,this theory considers “people” as a resource. People could be defined as boththe employees of the organisation as well as their end users. The ultimate aimof every business is profit maximization. In order to do that, theorganisations need to understand the buying behaviour of the end user as wellas the elements that lead to this buying behaviour. Without having a thoroughunderstanding of this, it is impossible for the business to gain more end usersand expand in the market.
This is true, specially so in the increasinglycompetitive market of today. Thus, the organizations should create a end userprofile that helps them in strategizing and targeting the desired end users andachieve maximum efficiency out of their efforts. Another method to make the endusers loyal to the organisation, is to serve the end users in a way that helpsthe organisations in gaining reference from them and makes them recommend theorganisation, product or service to their friends circle and family.
In orderto do this, the organisations should first understand the reason why end usersare inclined towards their products or services. This can be for rational reasonsor emotional reasons. However, it is observed that the end user makes thesedecision based on their mind using logic and comparison. The consumersalways try to make rational decisions which are driven by self interest, andinvolve a careful evaluation of all the options that are available to them,before making or finalizing any decision. The primary objective is always tomaximize the value for money, personal satisfaction and utility that theyobtain from a product or service.The InternationalFinancial Reporting Standards, known as IFRS, are the accounting guidelines formany nations around the world with the goal of being the globe’s universalreporting language.
It has long been demanded by a number of nations, toconverge and make the accounting standards of the world universal to bringabout consistency in the accounting and financial reporting of theorganisations(IFRS, 2011).With the increase ofglobalisation and promotion of international business organisations, it hasbecome very important to streamline financial statements for the multinationalorganisations and have a set of universal accounting standards throughout theworld. The organisations currently spend a lot of amount in terms of time andresources for complying with the specific reporting standards that aredifferent in each country that they operate in. This is a tedious job, and alsoresults in the reduction of efficiency and productivity of the organisations,as much of the resources are wasted in doing this. Therefore, the need arisesof having universal accounting standards that will make it easier for theorganisations to have these reporting standards, and lower the barriers thatare currently existing between the nations impacting the internationalbusiness. Another advantage of having universal accounting standards isthat the people will be easily able to invest in foreign organisations and thiswill bring about convergence in business and their operations(Pwc Team, 2015). Theorganisations that are willing to expand to International locations byacquiring organisations will also have better information and can make moreinformed decisions if they have the correct accounting information in the requiredformats.
Standardization enables the organisations to also have an approachthat is uniform through all their international operations that are functioningcross border and helps them in the alignment of their activities and processeswith their global presence. This will result in improved efficiency, reducedcost and consolidation of the various accounting practices that are currentlygoing on in the organisations. Having universal accounting standards willimprove the corporate governance and bring about transparency in the accountingand financial reporting standards. This will also reduce the risk involved forall the stakeholders of the organisation including the shareholders,organisational employees, directors, managers as well as their end users.Thestandardization of accounting practices reduces the risk of fraudulentactivities that go on within the organisation and lowers the risk for theinvestors, analyst as well as the authorities and helps them in making betterchoices and decisions. The investors are better protected in the market havingtransparent financial statements and uniform reporting standards.
With theadvent of globalisation and promotion of international business organisations,it became very important to streamline financial statements for themultinational organisations and to have a set ofuniversal accounting standardsthroughout the world. Therefore, the need arises of having universal accountingstandards that will make it easier for the organisations to have these reportingstandards, and lower the barriers that are currently existing between thenations impacting the international business