International Integrated Reporting Council Markets Director Sarah Grey (centre left) exchanging agreements with CA Sri Lanka President Lasantha Wickremasinghe (centre). Rest from left: Integrated Reporting Council Sri Lanka Chairman Asite Talwatte, Securities and Exchange Commission Director General Vajira Wijegoonawardana, Colombo Stock Exchange CEO Rajeeva Bandaranaike, CA Sri Lanka Vice President Jagath Perera and CA Sri Lanka CEO Aruna Alwis Pic by Indraratna Balasuriya
By Chandeepa Wettasinghe With the view of cutting down clutter in corporate annual reports and presenting crucial data through integrated reporting, the Institute of Chartered Accountants Sri Lanka (CA Sri Lanka) recently launched the Integrated Reporting Council.
“This is the first Integrated Reporting Council in all of Asia. It’s an opportunity for Sri Lanka to jump ahead and create confidence and trust in businesses in Sri Lanka to attract global capital flows,” International Integrated Reporting Council Markets Director Sarah Grey said. She said that the trend of integrated reporting started following the financial crisis, but companies and market regulators have only recently begun to embrace the concept. “Public company reporting gotten so complicated, that what should be communicated is lost. A study shows that many think the quality of the report reflects the quality of management,” she added. She noted that stakeholders are attracted towards a 100-page integrated report, which covers the most crucial aspects of the company’s financials,
types of capital and sustainable development, and if the option is available between the two, almost never download a 300-400-page annual report. Integrated reporting expert and Sri Lanka Integrated Reporting Awards 2015 Judge Graham Terry had said that most companies that applied for the awards had failed to grasp the purpose of integrated reporting and had applied with full annual reports. Despite their length, he criticized them for not including quantitative data on aspects like customer and staff satisfaction, executive level remuneration, as well as treating corporate social responsibility (CSR) as side projects for public relations propaganda. Integrated Reporting Council Sri Lanka Chairman Asite Talwatte noted that integrated reports provide greater analysis into each type of capital.
He added that publicly listed companies with integrated reporting have around 75 percent of physical and financial assets compared to around 20-40 percent of similar assets in non-integrated reporting companies, showing differences in standards. The Integrated Reporting Council of Sri Lanka will promote, educate and lobby for greater levels of integrated reporting in Sri Lanka. The council committee will be made up of officials from the stock exchange, the capital market, accounting and banking regulators, p r o f e s s i o n a l ac c o u n t a n c y bodies, universities, government