The Importance of Financial Information Georges Barthes de Ruyter Former Chairman of the International Accounting Standards Committee
Accounting • The Financial Information of an Enterprise is a by-product of its accounting systems. • International Financial Reporting Standards.
Financial Statements • The basis of the financial information of any enterprise. • Enterprise delivers messages to the public through its financial information. • Important that messages are in a language that is precisely understood.
Why reliable information? • Two arguments for reliable financial information. • International • National
Reliable Financial Information: International Context • Allows for free and efficient flow of capital. • Ensures best allocation of resources and lowest cost of capital. • Correlation between progress of financial information and growth of economy.
ReliableFinancial Information: National Context • Confidence in financial information attracts foreign and portfolio investment. • Better allocation of capital. • Importance of relevant standards and reliable information.
Conclusion • Importance of efficiency, independence and reliability of the audit profession.