Welcome To VMRC - Members or Supporters

VMRC member accountancy institutes are already working on a number of value measurement related initiatives that impact the goals of the VMRC.

American Institute of Certified Public Accountants (AICPA)

• Special Committee on Enhanced Business Reporting This Committee was approved by the AICPA Board of Directors in September 2002 to drive enhancement of the current reporting model. Since its inception, the Special Committee on Enhanced Business Reporting has dedicated significant resources to clarifying and defining how to succeed in this charge. The mission of Special Committee is to establish a consortium of investors, creditors, regulators, management and other stakeholders to improve the quality and transparency of information used for decision-making. Efforts to enhance business reporting will fall within the conceptual framework that contain the five elements of enhanced business reporting, including System Reliability, Financial and Non-Financial Measures, Information Dissemination, Understandable Disclosures and Corporate Accountability.

• Non-financial Information Task Force The goal of this task force was to “investigate how the auditor could report on non-financial information, or other information that is not a product of the entity's accounting system, when such information is included in an entity's financial statements.” There was concern about the current standards and whether they are applicable to non-financial information and that most of its current activities seem to be related to governmental issues. Despite this, the very existence of this task force demonstrated how the use of non-financial measures has advanced. For the purposes of its deliberations, the task force assumes that the standard setters have established the criteria for this information such that it is separately attestable under the audit or attestation standards.”

• The Group of 100 Task Force This task force was asked to consider the idea of a new reporting model and what barriers would arise against such a change. In September 2000, the task force made a recommendation to Barry Melancon, President and CEO of the AICPA, that the concept of a new reporting model was a worthy one, assuming there was support from the Big 4 accounting firms -- critical for any change in the reporting model.

• The 1994 Jenkins Report The Jenkins Committee's “Improving Business Reporting—A Customer Focus,” was issued in 1994 and proposed a still viable model and roadmap for changing the current model.

• The 2001 Elliott Task Force on Business Reporting in the 21st Century This task force issued a report in September 2001 that discussed the need for reform of the current reporting model. Recommendations from this task force included:

• The FASB should issue standards-level guidance on the location, form, and content of non-financial information that would supplement the historical financial statements. In particular, the FASB should address non-financial performance indicators, unrecorded intangible assets, and forward-looking information.

• The FASB should begin a project to consider revising the frequency of reporting based on the capabilities of modern accounting software and telecommunications and the needs of users.

Canadian Institute of Chartered Accountants (CICA)

• Strategic Performance Monitoring and Management: Using Non-Financial Measures to Improve Corporate Governance, by John Waterhouse and Ann Svendsen, published in 1998 This research report explores the importance and role of non-financial performance measures in providing boards of directors and senior management with the information needed for effective corporate governance. Similar to other documents on this topic, the report finds while the current system of financial measures based on accounting remains essential for effective corporate governance, it is clearly inadequate on its own.

• Environmental Performance - Measuring and Managing What Matters, by Allan Willis and Julie Desjardins, published in 2001- This resource provides “a straightforward discussion of environmental performance and shareholder value creation and the inclusion of a unique self-assessment guide.” Using this product, a company can evaluate its own environmental performance and shareholder value measurement system and identifying areas for improvement.

• The Measurement of Shareholder Value Creation , by Julie Desjardins, published in 1998 This report discusses the measurement and management of shareholder value creation and provides a self-assessment guide for senior managers and directors in developing their shareholder value measures and systems.

• The Canadian Performance Reporting Initiative

• Management's Discussion & Analysis: Guidance on Preparation and Disclosure , published in November, 2002 The financial statements and MD&A together are increasingly recognized as the core business reporting package: each needs to be read with the other in order for investors to get an integrated and forward-looking understanding of a company's performance and prospects.

The CICA guidance on Management's Discussion & Analysis (MD&A) disclosure sets out six principles and a five-part framework of recommended disclosure practices to assist companies in enhancing the usefulness of their MD&A reports.

• MD&A Interpretive Releases IR-1 Disclosure about off-balance sheet arrangements and related disclosures was released in April 2003.

• Measuring The Business Value of Stakeholder Relationships – Part 1, by Ann C. Svendsen, Robert G. Boutilier, Robert M. Abbott and David Wheeler, published in 2003 This research study is a joint initiative between the Centre for Innovation in Management at Simon Fraser University and the Haub Program in Business and Sustainability, the Schulich School of Business at York University, and was sponsored by the Canadian Performance Reporting Initiative of the CICA.

The report includes a review and critique of academic research on the business value of stakeholder relationships. It also proposes a model of the contribution of stakeholder relationships to business value and suggests a provisional set of measures for assessing the quality of stakeholder relationships drawing on the concept of social capital.

• Total Value Creation ® initiative

South African Institute of Chartered Accountants (SAICA)

• King Report on Corporate Governance for South Africa – The King Committee on Corporate Governance completed their second report and issued a Corporate Governance Code in 2002. SAICA served on the various sub-committees of King and played a key role in developing the Code. The intention of the Code is to establish a best practice on corporate governance and also to recommend disclosure requirements. Such disclosure would be included in the annual reports of companies, and in particular companies listed on the JSE Securities Exchange. Even thought the Code is not mandatory in terms of legislation, some of the principles have been included in the JSE listing requirements. SAICA would also issue guidance in some of the areas, in order to assist preparers of financial statements in implementation the Code

• Reporting on HIV/Aids - SAICA is working with the Global Reporting Initiative (GRI), the JSE Securities Exchange and other organizations to issue guidance on HIV/Aids reporting. As HIV/Aids is a major concern, especially in Africa, that would affect all spheres of society, including the business community, guidance is required as to what disclosures should be made by companies in their annual reports.