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ACCA Strategic Professional · Strategic Business Leader · Reporting to stakeholders

Marlowe Foods plc, a listed company, publishes its annual report. A pension fund holding a large block of shares complains that the report gives plenty of historic profit data but little on how the board expects to create value over the long term. Which reporting approach would best address this stakeholder's information need?

An integrated report is the best approach. It explains the strategy, business model, risks and outlook and how value is created across the capitals, which is the forward-looking, long-term information a significant institutional shareholder is missing from purely historic financial data.

  1. AIssuing a more detailed schedule of historic cost accounting policies
  2. BProducing an integrated report explaining strategy, business model, risks and outlook across the capitalsCorrect
  3. CPublishing additional details of employee social events in the chairman's statement
  4. DReplacing the audited financial statements with a narrative sustainability brochure

Explanation

Investors with a long-term horizon need forward-looking information on strategy, business model, risk and value creation. Integrated reporting is designed for this purpose. More historic policy detail does not address forward-looking value creation, and replacing audited statements would remove required accountability information.

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