Financial or Non-Financial Disclosure of Stockland Stapled
Assignment Question: Company Research
Select one of the following companies:
• AGL energy ltd
• Caltex Australia ltd
• Stockland Stapled (recommended)
• Telstra Corp Ltd
• Qantas Airways Ltd
Students should apply accounting theory to the selected company disclosure and reporting in terms of their environment and social responsibility including the conceptual framework, ethics in the workplace, CSR, and corporate governance. The student should consider issues such as whether financial or non-financial disclosure is more important, or whether different types of disclosures, or if more or less disclosure is available, or if the disclosure should be regulated. Students should find it useful to consider the most recent GRI index (G4) and ISO14000, ISO26000, ISO50001. Student should review the most recent annual report with the disclosure on the company website and any supplementary reports.
Assignment Answer: Company Selected Stockland Stapled
It has been said that there has been a reason behind each and every action performed by the human being. A person cannot perform any performed any action without any solid reason. In the case of accounting and finance or matter related to that, a person or accountant must be careful or cautious while performing any financial transaction. There must be proper reporting of all the work performed by the company as the company is responsible for its stakeholders. Apart from the financial context company must be responsible while taking non-financial decisions. The company must be socially responsible and must follow all the ethics while taking any important decisions.
Accounting deals with financial transactions therefore it is essential that every accounting work must be based on some reasoning. Accounting Theory is the conceptual framework that explains the reason or logic behind every accounting transaction. It is true that Generally Accepted Accounting Principles cannot be altered or changed but they can be reframed as per the changing needs of society or current economy requirement. Accounting Theory elaborates that it should be the responsibility of the company to report all working performed by the company in the past time period, to report it in front of the stakeholders or any associated persons. Accounting theory can be defined as a set of broad principles and rules having logical reasoning, framed to provide the framework where the accounting practice can be governed and where the development of new principles and rules can take place.
In this report, a review of the company has been done to argue on the financial disclosure and other regulatory reporting such as environment and social responsibility including the conceptual framework, ethics in the workplace, CSR and corporate governance. For this purpose, a company called Stockland Stapled is selected and all its reports are discussed in detail to throw the light on the above requirements. Accounting Theory is applied to discuss the financial reporting done by the company. Other reporting of the company will also be discussed with their specified headings.
Stockland is one of the most famous and diversified property groups in Australia that owns, controls, and built a wide range of public as well as private assets such as shopping centres, office and industrial assets, residential communities, and retirement villages. The Stockland Corporation deals in the development and regulation of real estate projects in countries like Australia, New Zealand, and the United Kingdom (Annual Report, 2013). The core business of the company is to invest in real estate assets like retail, office, industrial, and office park properties, and also includes residential properties and retirement living facilities. All these activities are regulated through extensive planning and high profile management facilities. In addition to these company offers services like property trust management and other management services related to property. Stockland Group was founded in the year 1952 and it has a clear vision to “Not merely achieve growth and profits but to make a worthwhile contribution to the development of our cities and great country”. The company vision is very much clear and it leads to long term development and provides meaningful objectives to the management. The company has a long and very proud history in the field of infrastructure development.
There have been places that expressively fulfil the needs daily requirements of the customers and communities. Stockland is one of the largest builders in retail shopping malls. The company owns, manages, and has developed the finest retails mall in Australia (Annual Report, 2013). Stockland is the leading residential developer and the company focus on delivering a wide range of master plan communities in the growing sector of Australia. Stockland has established retirement living centres in 5 states of Australia and looking forward to more investment in this segment. On analyzing the annual report of the year 2013 it can be concluded that the financial results this year is not satisfactory. There has been a prolonged downfall in the Australian residential market and other related impairments. Despite that the residential land market has hit the financial results of the company, the Commercial Property and Retirement Living have performed exceptionally well in these difficult market conditions (Annual Report, 2013).
Importance of Accounting Theory while reporting on social responsibility and on corporate governance
Accounting theory and accounting practices are closely related to each other. There are defined ways, following which the company has to make their disclosures and report on the various requirement like corporate social responsibility, sustainability reporting, and financial disclosures. Accounting theories are developed through analyzing, observing, evaluating, scanning, recording, and scrutiny of the day to day accounting practices. Day to day accounting practices must be performed through the successful application of defined and generally accepted theories and principles. These theories and principles change whenever there is change is an economic change in social beliefs and socio-economic changes in any country. It should also report that there will be a change in reporting format if there is a change in the accounting practices or any practices.
Companies are responsible to disclose the activities performed by them in relation to corporate sustainability, environmental sustainability, and social responsibility. Sustainability accounting has originated 20 years back and it has been considered as a subcategory of financial accounting. It aims at the disclosure requirement of non-financial information on the company performance to the external parties like stakeholders mainly customers, creditors, and capital holders (Annual Report, 2013). The nonfinancial disclosure contains the information related to the activities that have impacted the environment, society, economic performance of the company. The requirement of sustainability disclosure is mandatory and it contrasts with managerial accounting. Managerial accounting is used to regulate the internal decision making and creation of new policies that wide impact on company performance.
Disclosures of financial as well as non-financial information are mandatory and it is considered as the most important for reporting of various activities performed by the company with respect to the financial position, environment, and social responsibility. It considers the most important conceptual framework of like corporate social responsibility, corporate governance, and ethic at the workplace. All these disclosures are important for the stakeholders as well as any person connected with the organization. In addition to financial and nonfinancial disclosures, there is needed to make a disclosure regarding the other important matters that have a wide impact on the organization’s performance and its reporting requirement (Annual Report, 2013).
Sustainability Disclosure made by Stockland
It is the belief of the company that plays important role in the development of sustainable communities for the future. Stockland sustainability is ensuring we leave the communities where we operate, and the environment that they enjoy, in great shape for future generations (Sustainability Review, 2013). GRI establishes the guidelines to make a presentation of sustainability reports. G4 is the fourth generation of GRI’s Guidelines that aims to help the reporter to prepare meaningful sustainability reports and to robust the reporting standard practice. Stockland has successfully incorporated these guidelines while preparing their sustainability report (New G4 Content Index Tool and other useful G4-related resources, 2014). This has helped the company to give a new structure in the reporting standards. The company follows this by bringing change in the design, operative methods, and other regulatory frameworks on the basis of what has been suggested by the stakeholders.
As on the basis of the report of the year 2013, the company has refreshed the current stakeholder engagement plan template in order to bring some changes or further refine, enhance, and embed the approach of stakeholder’s engagement with the company (Corporate social report, 2013). The company has put the continued focus on professional development that includes training of assets and development teams to ensure better reliability on the stakeholders. In the future company has planned to hold the professional development workshops in all states in the next 12 months in order to understand the needs of the society and to gather any new suggestions on the development and maintenance of buildings (Sustainability Review, 2013). In year 2014 the company has planned to introduce the new rigor testing process to evaluate the effectiveness of our engagement is currently under development. Stockland has effectively disclosed all information related to the requirement of sustainability. The company publishes its annual sustainability report that contains all the major activities performed by the company in relation to the objectives for promoting sustainability in the organization.
Sustainability accounting leads the company’s strategy to the sustainable framework through disclosing the information on three-dimensional levels like environment, economic, and social. In real terms, it is difficult to put or follow all the policies that simultaneously promote goals related to the environment, economy, and social needs. In relation to satisfaction of retailer, shopper, and tenant, the company has addressed key areas of feedback in order to better meet the customer’s needs. In order to provide important to the tenants, the company has conducted the office and industrial tenant survey (Annual Report, 2013). As per the future plan company will conduct the transactional data center analysis on all our regional and sub-regional centers. In order to capture the valuable retailer data and other insights, the company has planned to use the LFR and VCAD tools in alignment with our CRM system. The company has taken all possible measures to maintain satisfaction across the Commercial Property business. Stockland has put the focus on the development of house and land packages that match the requirement and purchasing power for new house buyers (Sustainability Review, 2013).
Sustainability accounting has not only to lay emphasis on the creation of value but also leads to the risk mitigation that is connected to the environmental and social needs of sustainable development. Stockland has followed the international reporting format to report the activities it has taken for sustainability development. It has helped in recognizing the financial information and also helps to extent it to the social and environmental levels. As there is no set reporting format to report on sustainability, it majorly depends on the factors, reporting standards, and other regulations and guidelines. Stockland has taken care of all the reporting standards while preparing its report on sustainable development.
In order to provide lifelong learning and prosperity, the company has decided to design a framework that delivers improved education and learning opportunities in backward parts of Australia. In this context, the company has able to deliver a wide range of education facilities to the children at various levels. This step has contributed in economy development of the country and has also able to increase the customer image. In order to consider the health and well-being of the employees at the workplace, the company has taken various new measures that help in gaining the complete satisfaction of the employees.
Sustainability accounting is also necessary as it helps input the check on the company activities taken to secure natural resource management. Stockland has taken significant steps to control CO2 emissions. In order to conserve the biodiversity, the company has to make use of alternative ownership and management models to ensure areas of biodiversity retained through master planning processes. Management has reported all the major areas on which various steps have been taken. It includes biodiversity, water, any change to climate and energy, and any other necessary activities. The company has taken significant steps to lower the consumption of water through the use of highly advanced technology.
In order to make the whole process energy sufficient company has decided to monitor the level of consumption of energy through the use of internal systems like as Activa, JDE, and BMM and CCAP tools. The company has successfully incorporated the Commercial Property climate resilience assessment tool in the major process of D-Life planning (Sustainability at Stockland, 2013). This has helped in adapting climate change in a successful manner. ISO 50001 is related to energy management and using the guidelines helps the company to save money as well as helps in conserving the resources. Stockland has successfully able to establish the energy management system (EnMS) using the guidelines given in ISO 50001 (ISO 50001 – Energy management, 2014).
It has seen that in some countries there has been no government requirement for companies to prepare and publish the sustainability report. On the talking about the Australia government, it is seen that there is a statutory requirement to develop and publish sustainability as well as CSR reports to the public. There are established set of guidelines and frameworks given by the Organization for Economic Co-operation and Development (OECD) and GRI. A company that fails to report as per the set guidelines of OECD and GRI will definitely reduce their credibility.
Corporate Social Responsibility
Every company is liable to report on the measures taken to give some contribution to fulfilling social responsibility. Corporate social responsibility is referred to as corporate social regulation that must be integrated into the business model. On reviewing the corporate social reporting done by the Stockland, it can be said that the company has followed all the guidelines established by the OECD and GRI in making the Corporate Social Report 2013. ISO 26000:2010 is the most important standard that provides guidance rather than requirements. This ISO is related to social responsibility and it helps the organizations to translate the principles into effective actions and shares best practices that are related to social responsibility. Stockland takes use of ISO 26000:2010 to implement the changes in social responsibility. CSR is essential as it helps to look over the non-financial performance of the company in the field of corporate social liability (ISO 26000 – Social responsibility, 2014).
Stockland has maintained a strong balance and taken all possible steps to remain at A credit rating. The company has a prudent cost management policy and operational capability that helps in reducing the overheads by around 10%. The company has met all the criteria of the ISO regulation while taking its activities. It helps the company to successfully contribute a lot in corporate social responsibility. In the year 2013, the customer satisfaction of the company has increased to 71 %, a total increase of 3 % from the past level. Management has implemented the measures that help in the understanding of customer needs. Product innovation, value, and convenience are some of the measures taken by the company to bring customers satisfaction. Sustainable development and management of resources have become the core competencies of the company and many signs have taken to achieve it.
Management at Stockland takes the governance responsibility very seriously. Board believes that they have a mix of experience and skills to oversee the high standard of corporate governance, integrity, and accountability required of a professional and ethical organization. The company has taken possible measures to adhere to the principles and recommendations of the ASX Corporate Governance Council in establishing corporate governance in the management. Corporate social responsibility is something bigger than accountability. Accountability is the part of the corporate social responsibility. Moreover it comprises three main tools i.e. accounting, auditing, and reporting. GRI is the most important stakeholder that establishes the public reporting guidelines or frameworks at the international level (New G4 Content Index Tool and other useful G4-related resources, 2014). There are many international level measures adopted by the Stockland in their reporting requirement to align with the GRI regulation framework (Annual Report, 2013). Socially Responsible Investing (SRI) is also closely linked to CSR and it requires various standards to be followed with the aim to achieve set requirements of ISO14000. ISO 14000 is the set of tool that helps in addressing the various aspects of environmental management (ISO 14000 – Environmental management, 2014). Stockland has taken all the steps to identify and control the environmental impact and improving environmental performance.
Ethics at the workplace
Stockland is one of the organizations that value their employees more than any stakeholder. The company follows the complete requirement of workplace ethics and take all possible measure to establish them. Workplace ethics and behavior are a crucial part of corporate social responsibility and it is essential to make the company profitable. It helps in achieving high morale and teamwork among the workers. Stockland is accountable to report on the ethics it has established at the workplace. The company takes the complete responsibility of the workers and helps to promote good ethics and behavior at the workplace.
In last it can be concluded that it is essential for all the companies to report financial as well as a nonfinancial matter to their stakeholders through using the guidelines and reporting standards established by various governing bodies by international as well as at the national level. In this report, we have successfully examined the reporting of financial as well as non-financial information by the Stockland company. On a successfully examination of all the reports, it has found that the company fulfills all the requirements set by various standards farmed by OECD and GRI. The company also follows various ISO standards to implement changes in social responsibility.
Annual Report 2013. Stockland . [Online]. Available at: https://investor.stockland.com.au/phoenix.zhtml?c=173099&p=irol-reportsannual [Accessed on: 24 September 2014].
Corporate social report. 2013. Stockland . [Online]. Available at: https://www.stockland.com.au/reports/2013/index.htm [Accessed on: 24 September 2014].
ISO 14000 – Environmental management. 2014. [Online]. Available at: https://www.iso.org/iso/iso14000 [Accessed on: 24 September 2014].
ISO 26000 – Social responsibility. 2014. [Online]. Available at: https://www.iso.org/iso/home/standards/iso26000.htm [Accessed on: 24 September 2014].
ISO 50001 – Energy management. 2014. [Online]. Available at: https://www.iso.org/iso/home/standards/management-standards/iso50001.htm [Accessed on: 24 September 2014].
New G4 Content Index Tool and other useful G4-related resources. 2014. [Online]. Available at:-
https://www.globalreporting.org/information/news-and-press-center/Pages/New-G4-Content-Index-Tool-and-other-useful-G4-related-resources.aspx [Accessed on: 24 September 2014].
Sustainability at Stockland. 2013. [Online]. Available at: https://www.stockland.com.au/about/sustainability.htm [Accessed on: 24 September 2014].
Sustainability Review. 2013. Stockland. [Online]. Available at: https://www.stockland.com.au/sustainability/2013/performance-priorities-and-targets.htm [Accessed on: 24 September 2014].