A study of Advanced Accounting Corporate Reporting Essay

The intent of fiscal statements is to give fiscal statements information about the alteration in fiscal place, fiscal public presentation and fiscal place of the organisation. These can supply informations usage in determination devising such as investing, recognition and economic determination devising which are utile for assorted users. There are seven chief groups of users which are public, investors, loaners, employees, clients, supplies, authorities and other bureaus and the demands of information is different for each group, for case, employee will involvement on the profitableness, retirement benefits and employment chances and so on. Fiscal statement is supposed to relevant, dependable, apprehensible and comparable. In add-on, fiscal statement may include other information, for illustration, the uncertainnesss and hazards that influence the organisation.

Evaluation of the relevancy, dependability, comparison and comprehensibility

Relevance is about the information that has the ability to act upon the economic determinations of users. There are two chief points relate to the relevancy which are prognostic value and collateral value. Predictive value can assist users to mensurate the yesteryear, nowadays or future public presentation. Confirmatory value can assist users to corroborate their past ratings. The one-year studies include ten-year statistics which have the recent ten-year figures. It includes net income and loss history, balance sheet and rider services figures and so on. It can assist the stockholders to corroborate the past ratings, step the past public presentation and compare the relevancy information at the same clip.

The one-year studies embody a portion of operating web with future extensions. In this portion, the study has stated all belongingss that they are developing, building, planning and the belongingss that owned, developed and managed by them. It can assist us to foretell the present and future public presentation and verify the past ratings.

In the one-year studies, we can happen the CEO ‘s reappraisal of operations and mentality. This portion is the MTR ‘s CEO taking about the MTR yesteryear public presentation which is good and which is bad, it besides mentions the following twelvemonth development of the MTR. It gives us a clear head about the MTR what will make during the following twelvemonth and briefly review the old twelvemonth public presentation.

Dependability is about the information that is a complete and true representation. There are five major issues involve in dependability, free from material mistake, a faithful representation, impersonal, prudent and complete. MTR use one of the large 4 accounting company that is KPMG. KPMG is a big international company and has a batch of scrutinizing experience and professional staff. Therefore, stockholder can hold a great assurance on the fiscal statements. On the other manus, the audit study province that the KPMG give a true and just position that means the MTR studies are decently prepared with accounting criterions which means the studies are free from stuff, faithful representation, prudence and complete. Besides, the accounting house is an independent audit house which can carry through the point of impersonal. As a stockholder, we can hold a great assurance on that studies, because it is accuracy and do non hold any originative history.

MTR is a public organisation and it is managed by authorities. It has been required a high transparence that revelation all information to public, such as, company policies, hence, their information must be faithful, impersonal, prudent and complete which are required by jurisprudence. So, their information has a high dependability. From the position of stockholders, we can swear on it.

The MTR have an internal audit squad which is responsible for the internal control, undertaking reappraisal, fraud probe, due diligence and direction reappraisal and so away. It can assist the MTR to give us a study that is dependable, free from material mistake, faithful, impersonal, prudent. As a stockholder, we can hold great assurance on the one-year studies.

Comparison is about the similarities and differences can be discerned and evaluated. There are two cardinal affairs include in the comparison which are consistence and revelation. Inside the one-year studies, we can happen many figures that can give us to compare. Such as the Ten-Year Statisticss, it includes 10 old ages informations for us to recognize. We can see that the net incomes per portion are increased steadily each twelvemonth from $ 0.81 per portion in 2000 to $ 1.69 per portion in 2009. Besides, the net income is increased quickly from $ 7,758 on 2006 to $ 15,182 on 2007.

In add-on, in the CEO ‘s Review of Operations and Outlook portion, it compare a batch of informations, for illustration, the Average weekday backing for the Domestic Service in 2009 was 3.5 million, which represents an addition of 0.9 % over 2008 and the entire gross from belongings lease, belongings direction and other concerns in 2009 was HK $ 2,928 million, an addition of 8.0 % over 2008.

Furthermore, the fiscal statements have provided two old ages figures for us to compare which is 2008 and 2009. For case, the Loans, other duties and bank overdrafts is decrease significantly from $ 31,289 in 2008 to $ 23,868 in 2009 which decline 23.7 % . The dividend per portion is increase from 0.48 in 2008 to 0.52 in 2009 which increase 8.3 % . From the figure that we have analysis above, we can see that the MTR net income is increase each twelvemonth and the loan lessening each twelvemonth, hence, it is a signal for us continue to maintain the portion or investing more.

Comprehensibility is about the significance of the information can be perceived. There are two of import points contain in the comprehensibility, users ‘ abilities and collection and categorization. Inside the one-year studies, it contains a glossary portion. In the glossary, it explains a peculiar sphere of cognition that uncommon, specialized or freshly introduced. For illustration, runing border means runing net income from railroad and related concerns before depreciation and amortisation as a per centum of the turnover and ordinary portions means ordinary portions of HK $ 1.00 each in the capital of the company and so away. As a stockholder, it helps a batch during reading the one-year studies, because non every stockholder besides has that much professional cognition.

The one-year study contains many image, tabular array and chart. An one-year study is really thick, because it contains big information about the MTR public presentation. From the position of stockholder, if the studies are full text, it is difficult for us to read it all, because it has a batch of words to read and understand. When reading the one-year studies, it is non difficult to happen images, tabular arraies and charts, it can assist us more easy to recognize the information, particularly the tabular arraies and charts, it convert the figures into a understandability signifier so that the readers can catch the chief point easy.

It besides includes a content page and classifies similar informations to similar group. When we look at content pages, it non merely states the rubric but besides province the figure page which makes the stockholders more convenience to happen the information what they need.

This one-year studies have different linguistic communication version which can take attention of different users, although this MTR is a Hong Kong organisation, as a stockholders, I may be a alien and I can non read any Chinese words. Therefore, different linguistic communication version is of import as good. It is easy to happen that the MTR one-year studies have been prepared by two versions which are Chinese and English.

Which one of the four qualitative features of fiscal information is the most of import?

In my sentiment, the dependability is the most of import qualitative feature.

If the fiscal statements are non dependable, the stockholders will non hold any assurance on the MTR studies, because they feel that the fiscal statement information of the MTR is non faithfulness and truthfulness. Hence, they will non hold any involvement to recognize the MTR studies, so that the aim of fiscal statement is invalid. Even though the one-year studies has higher quality of relevancy, comparison and comprehensibility, but without dependability which will do the stockholders and possible investors run off.

In the opposite side, if the fiscal statements have a higher grade of dependability, the stockholders will hold more assurance on the one-year studies, because higher grade of dependability means the one-year repot have meet the demands of free from material mistake, a faithful representation, impersonal, prudent and complete. When the studies meet those demands, it attracts the stockholders stay and attracts more investors.

When seeing the MTR one-year studies, we can cognize that their studies have a good dependability. The MTR employ an external accounting house which is KPMG to scrutinize their accounting information, it fulfill the point of impersonal. The audit house besides give a true and just position to the MTR which means their information are faithful, complete, prudent and free signifier stuff mistake.

From the above treatment, we can see that dependability is the most of import qualitative features in the fiscal statement.


During analysis the MTR one-year studies, I know that the four qualitative features have a great influence to stockholders. It has a important impact on the determination devising, because it can assist them to understand, recognize and construct up the assurance on the MTR studies. The four qualitative features besides affect the stockholders invest or non. In my sentiment, the dependability is the most of import qualitative feature, it represents faithfulness and truthfulness. Shareholder will depend on it to make up one’s mind whether those accounting information can swear or non, thereby to be aftering the investing determination.