Improving Human Resource Accounting through International Financial Reporting Standards

Human Resource is the most valuable asset an organization can possess. Investment in it ultimately brings about growth in the future earnings of an entity. Today, in accounting parlance, it is treated in financial statements as an expense item rather than as an intangible asset which has capacity to generate future stream of incomes. Non-treatment of human resource as an asset obviously distorts the value of economic information presented in financial statements to internal and external decision makers on the real and potential value of the organization most valuable asset. This study focuses on the usefulness of Human Resource Accounting and the need to promote its wide acceptance through International Financial Reporting Standards. This study using First Bank Nigeria Ltd as a case study adopted the Flamholtz’s Historical Cost of Hiring Human Capital model to determine the value of human resources. Secondary data obtained from the annual reports and accounts of First Bank Nigeria Ltd from 2012-2013 was used. It was discovered that the Gearing, Earnings per Share and Return on Assets of the bank showed better results when human resource value was inputted in the financial report than when human resource value was not inputted in the financial report from 2012 to 2013.It was recommended that the International Accounting Standard Board should develop and issue an International Financial Reporting Standard on treatment of human resources as an asset. Keywords: Accounting, Asset, Human Resource, Human Resource Accounting, International Accounting Standard Board, International Financial Reporting Standards, Investment, Organizatio

Evaluation of Effectiveness of Internal Control System in Small Business Organisations in Ekiti State of Nigeria

The study evaluates the effectiveness of internal control system in selected small business organizations in Ekiti States in Nigeria.  The study identified types of Internal Control and assesses the impact of internal control on these organizations.  This was with a view to develop appropriate framework to improve the effectiveness of internal control in a system.  The study covered purposefully selected small business organizations in Ekiti states of Nigeria. Questionnaires were administered and were supplemented with oral interview to elicit information from staff of these organizations.  The data collected included the level of the adequacy of internal control, the level of staff involvement in internal control and the impact of internal control on the smooth operations of organisations.  The data collected were analyzed using appropriate statistics.  The result  showed that there was grossly inadequacy of internal control in the organizational aspect having a rating index of 2.50, arithmetic and accounting control with a rating index of 2.88, personnel has rating index of 2.96 and segregation of duties with an index of 2.80.  The study concluded that the compliance with the internal control in small organizations in Ekiti State is very poor.  Suggestions were made on different ways of improving the effectiveness of internal control system in order to achieve the organizational objectives. Keywords: Internal Control, asset, management, compliance, financia

Corporate Social Responsibility Reporting Practices in Banking Companies in Bangladesh: A Review

This paper reviewed the work of Ullah and Rahman on Corporate Social Responsibility (CSR) reporting practices. This has been an issue of concern both in terms of content and impacts on the bottom lines of businesses as well as compliance with regulations regarding CSR and extent of compliance. The review assesses how well the objectives of the authors were achieved and the applicability of its findings. Results showed that although content analysis was appropriately adopted for the study, the outcomes may be a result of tax inducement implemented. In addition, linguistic approach was also used in the study. 97 relevant factors extracted from literature on CSR reporting were categorized into seven but the basis was not disclosed. This impairs reliance on the results of the analysis. In determining the effect of regulatory changes on the volume of CSR information disclosed, descriptive analysis was used and it is inadequate for generalizations drawn. It would have been more conclusive if it had been compared with data from other climes. In assessing the relationship of Bank characteristics to CSR reporting, the definition of what constitutes independent and dependent variables. This study has pointed attention to the roles of policy response in CSR expenditure

Sustainability Reporting and Discretionary Accruals of Multinational Corporations in Sub-Saharan Africa

The quality of accounting information has attracted considerable interests among many scholars, investors, and other stakeholders worldwide. Earnings management is one of the factors responsible for this development. However, studies have shown that sustainability reporting can assist companies in reducing information asymmetry which encourages earnings’ manipulation. Hence, the paper investigated how sustainability reporting could influence accrualsbased earnings management among multinational corporations in Sub-Saharan Africa countries. The research’ design wasex-post facto. All the 48 multinational companies in thesub-Saharan Africa countries constituted the study’s population. Purposive sampling technique was used in selecting 5 multinational companies from each of 10 sampled countries based on data availability. The data for the period 2010-2019 were obtained from the published annual financial reports of the sampled multinational companies and the Global Reporting Initiatives (GRI)’s sustainability guidelines. The study revealed that the lag of discretionary accruals, corporate governance sustainability reporting and economic sustainability reporting had positive relationship with discretionary accruals, while social sustainability reporting and environmental sustainability reporting were negatively linked to discretionary accruals. Additionally, the study found that sustainability reporting jointly had significant effect on discretionary accruals of multinational corporations in Sub-Saharan Africa (Adj. R2 = 0.33, W(6, 444 ) = 668.67, P<.05).This study concluded that sustainability reporting exerted significant influence on discretionary accruals of multinational corporations in Sub-Sahara Africa. The study recommended that management of multinational corporations in sub-Saharan Africa should ensure strict compliance with sustainability reporting so as to improve the earnings quality. Keywords: Sustainability reporting, environmental reporting, economic reporting, social reporting, corporate governance reporting, earnings management, discretionary accruals. DOI: 10.7176/RJFA/12-24-02 Publication date: December 31st 202