Financial reporting and Ratification: Difference between pages

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1.  
1. ''International law''.


Financial reporting is traditionally external.
Approval of an international treaty by the relevant head of state, or the head of state and the legislature, when necessary to bring the treaty into force.


It is concerned with collating and providing information to external stakeholders, the financial markets and the public.
Most international treaties state expressly whether or not ratification is required, to make them effective.




2.  
2. ''Contract law - agency.''


The term 'financial reporting' is also used by some organisations in a broader sense, to include internal reporting (as well as external).
Confirmation or adoption of an act, where necessary for it to have legal effect.


For example, if an agent - without authority - forms a contract with a third party, the principal can ratify and adopt the contract, making it fully effective and enforceable.


Financial reporting is also known as ''financial accounting''.


3. ''Company law - sanctioning minor irregularities.''


===The objective of financial reporting (IFRS)===
In the case of minor irregularities in running a company, a general meeting can pass a resolution to sanction the irregularity.


The users of financial information need to assess:
Major irregularities cannot be sanctioned in this way, for example ''ultra vires'' acts, or a fraud on the minority.


*Prospects for future net cash inflows to the reporting entity; and
*Management's stewardship of the entity's economic resources.


''Source: Oxford Dictionary of Law, 8th Edition''


Accordingly, financial reporting seeks to provide information about:


*The entity's economic resources (assets), claims against the entity (liabilities) and changes in those resources and claims; and
==See also==
*How efficiently and effectively management has discharged its responsibilities to use the entity's economic resouces.
*[[Agent]]
 
*[[Company law]]
 
*[[Comprehensive and Progressive Agreement for Trans-Pacific Partnership]]
== See also ==
*[[Contract]]
* [[Closing exchange rate]]
*[[Fraud on the minority]]
* [[Conceptual framework]]
*[[Free trade agreement]]
* [[Credit]]
*[[General meeting]]
* [[Entity]]
*[[International law]]
* [[Financial accounting]]
*[[International trade]]
* [[FP&A]]
*[[Law]]
* [[International Financial Reporting Standards]] (IFRS)
*[[Legislature]]
* [[Management accounting]]
*[[Resolution]]
* [[Management efficiency ratio]]
*[[Sanction]]
* [[Stakeholder]]
* [[Treaty]]
* [[Stewardship]]
*[[Ultra vires]]
* [[Useful financial information]]


[[Category:Accounting,_tax_and_regulation]]
[[Category:Accounting,_tax_and_regulation]]
[[Category:Corporate_finance]]
[[Category:Manage_risks]]

Latest revision as of 13:32, 18 July 2022

1. International law.

Approval of an international treaty by the relevant head of state, or the head of state and the legislature, when necessary to bring the treaty into force.

Most international treaties state expressly whether or not ratification is required, to make them effective.


2. Contract law - agency.

Confirmation or adoption of an act, where necessary for it to have legal effect.

For example, if an agent - without authority - forms a contract with a third party, the principal can ratify and adopt the contract, making it fully effective and enforceable.


3. Company law - sanctioning minor irregularities.

In the case of minor irregularities in running a company, a general meeting can pass a resolution to sanction the irregularity.

Major irregularities cannot be sanctioned in this way, for example ultra vires acts, or a fraud on the minority.


Source: Oxford Dictionary of Law, 8th Edition


See also