Feb 24, 2002 (07:02 PM EST)
Clarity In Reporting Gets Hip
Read the Original Article at InformationWeek
Several businesses said last week that they're changing financial-reporting procedures, responding to pressure from investors and regulators to improve disclosure practices in the wake of the high-profile collapses of Enron and Global Crossing.
General Electric Co. and IBM changed their practices following pressure from investors. A new InformationWeek Research survey found that many companies say they aren't yet ready to meet requirements proposed by regulators that financial reports be more lucid and filed faster. Only 39% of 175 business and IT executives surveyed say they're prepared to accelerate their time-to-file forms to the SEC. Less than a third of those not yet prepared say they could improve filing time within a year. Businesses using financial-planning software to improve internal forecasting and budget analysis say they're ready to face changes in reporting requirements without a glitch. But 70% say their enterprise-scale financial applications are only somewhat integrated.
IBM, among those recently criticized by investors for not detailing significant transactions on income statements, says it will present a more complete picture of its performance next month, when it releases its 2001 annual report. GE says it will increase information it gives investors by disclosing individual revenue and income for 26 of its 36 units. Of particular interest to investors will be the numbers reported by GE Capital, the company's largest unit. The changes will start in GE's next annual report, to be released in early March.