October. KTU Roundtable on Understanding Investors (Kaunas. Lithuania)
On 2 October 2013 Kaunas University of Technology organised a roundtable discussion based on ACCA’s research “Understanding Investors: Directions for Corporate Reporting”. The aim of the event was to examine relevance of the issue in the local market, as well as to foresee future developments of corporate reporting under Lithuanian economic conditions.
Near 20 students of the Accounting and Auditing Department took place in this roundtable. They were asked to provide their opinion on investors’ decision making, information sources, corporate reporting, its improvement and timeliness of information.
The feedback from students can be summarised to following:
- Most companies in Lithuania try to disclose as less information as possible, in order to hide it from competitors, while investors are looking information behind financial reporting.
- Quarterly reporting is sufficient to satisfy investors’ need, however it should not be audited, in order to stay quick and cost-effective.
- Financial statements should be made more often or there should be a system in place which ensures receipt of information to the investors at the right time.
- Enterprises shouldn't overemphasise the importance of smaller investors (the "speculators") because it is the financial statements for a longer term that give the real value to the stockholders.
- In order to attract more investments Lithuanian companies should focus not on the data of previous year but of the current one in order to see improvement and perspectives.
- Introduction of integrated reporting in Lithuania to investors ensures more effective investment decisions and a better return on investment focusing on the long term.
- The language of business statements XBRL is a solid instrument for the investors wishing to get the access to the financial information of the companies as the information reaches the stakeholders easier and the possibility of mistakes is significantly smaller.
- One of the most common problems for investors in Lithuania is that most companies provide only the information that is required of them by law and other regulations, but they do not disclose additional information, especially if it is negative.
- Verification of information received, as well as decision-making is an important external information (positive, negative comments about the company, media articles, etc.).
- Each investor is interested in a fair, timely and high quality financial information, obtaining, using minimal resources. Some investors worry that company management spends too much time on quarterly reports.
- In Lithuania the greatest need for improvement is the company’s balance sheet and cash flow statement. The both statements involve far too much aggregation.
Pictured: event participants
The full text of the outcome document is available from the related documents section to the left of this page.