The Public Face: Financial Reporting

Abstract

Financial statements or reports are at the heart of compliance activities. As evidence of an organization’s business activities and state of health, they are key record of its presence and value in the market. From this all other evaluations flow, especially the valuation of its capitalization and its suitability as an investment. A good financial report can increase the value of the company, and a bad financial repot can adversely affect the same value. The simplicity of this also summarizes the significance of the Sarbanes-Oxley Act. A company that can demonstrate its compliance demonstrates its likely financial integrity. This demonstration underpins its trustworthiness. The figures may dip and the actual value might drop, but the perception of being a sound operation may be enough to ensure that it remains a good investment.