ICAS launches discussion paper and call for research on performance

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By Michelle Crickett, ICAS Director of Research

18 May 2016

ICAS calls for a debate and research on the ‘notion’ of performance and how it is reported.

The paper – What is performance? - was launched at an ICAS symposium at a large international accounting academic conference – the European Accounting Association (EAA) Congress in Maastricht.

Drawing accounting academics from around the world, the congress was the perfect opportunity to start the debate on what performance means and how it should be reported in a changing business environment.

Professor Stefano Zambon, University of Ferrara and ICAS Research Committee chaired the session, which included the following speakers:

  • Hilary Eastman, Director, Head of Global Investor Engagement, PwC and ICAS Research Committee and member of the ICAS working group which prepared the paper.
  • Hugh Shields, Executive Technical Director, IASB.
  • Deepa Raval, Project Director, Accounting and Reporting Policy Team, UK Financial Reporting Council
  • Peter Malmqvist, Chief Equity Analyst, Remium Nordic and Chairman, The Swedish Society of Financial Analysts

A fuller report on the discussions at the symposium is also available.

The topic had already been highlighted as a key issue in the Congress opening key note speech by Hans Hoogervorst, Chairman of the International Accounting Standards Board (IASB).

Mr Hoogervorst commented that performance reporting ‘will likely form a major part of our Agenda in the next couple of years’ and that ‘making progress in performance reporting is going to be a very challenging’.  Mr Hoogervorst also expressed concerns about the increased use of non-GAAP metrics.

ICAS hopes that its new discussion paper will help move the discussions forward by addressing two distinct elements:

  1. The concept of ‘performance’ itself: what it means; the extent to which non-financial factors should be considered part of performance; and whether an agreed definition of performance can be arrived at.
  2. How performance is reported: including who it is reported to; how it is measured; and the most appropriate channels of communication.

This in turn raises the question of assurance and how the board can obtain sufficient assurance, whether internal or external, on an entity’s wider performance measures and disclosures to the market and whether there is a demand from investors for assurance or if there is a risk that this would constrain innovation in corporate reporting.

The paper is not intended to offer solutions but seeks to ask the key questions and encourage debate.

The paper also calls for applications for funding to undertake research in this area – the deadline for applications is 30 September 2016.

Share your views

Please help inform our work on performance and provide your views on the questions raised in this paper and/or apply for funding to undertake research in this area.  For further information, please contact research@icas.com.


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