Broad Parameters for Evaluation for the Competition, 'ICAI Awards for Excellence in Financial Reporting'. - (03-06-2013)
July, 03rd 2013
BROAD PARAMETERS FOR EVALUATION
I. Chairman's Statement / Director's Report
Content & comprehensiveness of coverage of matters
Explanation in case of emphasis of matter paragraph there in auditor's report
Information relating to and impact of post balance sheet events
Statement on vision and mission of the organization
Statement relating to corporate ethics, values and risk management.
Presentation of any other information relevant and useful from stakeholders' perspective
in the specific context of the Company's business.
Comprehensiveness of Director's Responsibility Statement as required by relevant
provision of applicable law.
Consistency of information included in Chairman's Statement/Directors' Report with
underlying financial statements.
II. Management Discussion and Analysis
1. Operating Performance
Overview of the state of affairs of the Company.
General review of performance of the company as a whole and its divisions in the back
drop of the given socio-economic and geo-political environment of business, nature of
its activities, peculiar problems facing the industry, in general, and the Company's
activities, in particular.
Performance of various products and/or segments of the Company during the period
under review, future plans and prospects, with emphasis on sustainability management.
Performance of various group companies together with future plans, prospects, business
risks and risk mitigation measures.
Description of external oversight of various functions like systems audit by an external
specialist and other measures taken to enhance credibility of systems for internal
controls and financial reporting.
Information as regards Company's contribution to national exchequer and to the
economy of the country as a whole.
Comprehensiveness of content in general.
2. Enterprise Risk Management
Description of various risks faced by various businesses of the Company as a whole and
steps taken to prioritise, mitigate and monitor identified risks.
3. Human Resource Development
Description of the Company's policy relating to human resource engagement, training
and development, including information on measures taken by the Company to meet its
obligations and responsibilities towards employees in particular, measures relating to
working environment, career progression, health, hygiene, safety, personal development
and so on.
4. Corporate Social Responsibility
Information regarding the policy of the Company relating to corporate social
responsibility and how it has been applied in practice including contribution to
community development projects e.g. medical and health care facilities, educational
institutions, availability of clean drinking water, sanitation facilities, conservation and
development of environment and ecology, skill development and formation of self-help
5. Environment Green Movement
Measures taken by the Company towards environment protection, sustainable
development and growth of the business as well as 4Ps bottom line reporting. 4Ps
include Product, Profit, Planet, People.
III. Corporate Governance Report
Comprehensiveness and clarity of content of the corporate governance report.
Information as to non compliances of mandatory requirements of the concerned Statutes
and Regulators and whether there are appropriate explanations for such non
Clarity of description of role and responsibilities of various governance committees like
Audit Committee, Nominations Committee, Remuneration Committee, etc.
Adequacy of governance measures and policies adopted by the Company in the context
of its size and stature of the entity and as well as adequacy of diversity in terms of
gender, qualifications and professional experience of executive and non executive
Detailed description of systems and procedures followed for Corporate Governance and
availability and contents of Compliance Certificate issued by Statutory Auditors and
others mandated by the law.
IV. Dissemination of financial information
Availability of information on website and ease of viewing
Steps taken to disseminate sensitive information in Company's own website, Stock
V. Quarterly results
The content of quarterly results, in particular, the clarity and comprehensiveness of the
notes explaining financial results and variations, if any, over quarters or between
audited and unaudited results.
VI. Technical Content Financial Statements
Technical contents are to be judged for both separate financial statements and consolidated
financial statements, where presented.
Compliance with Accounting Standards and other requirements as per the Companies
Act and/or other applicable statutes.
Compliance with requirements of concerned regulators e.g. Circulars issued by the RBI
in case of banks, those of the SEBI in case of listed companies, in preparation and
presentation of financial statements.
Compliance with Guidance Notes and other authoritative literature issued by the ICAI
and any other applicable institutional framework.
Comprehensiveness, adequacy, quality and content of disclosures required under the
relevant Accounting Standards, Revised Schedule VI to the Companies Act, 1956,
concerned Regulators, Guidance Notes issued by ICAI , etc
Clarity adequacy and disclosures of accounting policies.
Information relating to subsidiaries with clear distinction of those within India and
outside India and comprehensiveness of information in relation to financials of
subsidiaries as applicable/required by law. Information relating to associates within and
outside of India, as well as adequacy of the same with clarity of information provided
Adequacy of explanation and quantification in situations where there is no specific
standard to deal with a particular item
VII. General Overall look and feel of the annual report
Colour scheme adopted and whether the same is enhancing readability or affects
readability by a layman, e.g. a general shareholder.
Layout of the annual report clearly distinguishing between various segments of the
Format adopted for presenting consolidated financial statements and stand alone
financial statements such that there is clear distinction between the two e.g. by adoption
of different colour schemes or markings, etc.
Quality of the paper, printing and overall aesthetics of presentation.
Readability of the report type of font, size, etc.
Usefulness and relevance of information provided in the report keeping in view
whether there is any over crowding of unnecessary and irrelevant information is
Presentation and analysis of information through graphs, charts, tables, etc.
Nature of details provided in terms of unit of measurement, rounding off criteria
adopted, etc and whether they are easily noticeable and whether there is consistency of
adoption of the same throughout the annual report.
Adequacy of cross referencing of schedules and various segments of the annual report.
VIII. Statement of Value Added and its Distribution Value Added by the Enterprise
Contribution to Government as taxes and other levies.
Distribution to Shareholders as dividend
Payments to employees as remuneration
Retention by the Enterprise
IX. Ratio Analysis with description of formulae, and Explanatory Statements by
Management with brief comparative analysis of performance of the entity.
Gross Profit Ratio
Debt Equity Ratio
Return on Capital Employed
X. Additional Disclosures
Any other information or measure like integrated reporting