Financial reporting and performance of organizations

Abstract

The main purpose of the study was to examine the significance of financial reporting on organizational performance. The study was guided by the following objectives: to examine the forms of financial in the organisation, to examine the relationship of the financial reporting and performance of an organization and to analyze the challenges of financial reporting in organizations. The study was carried on using a detailed literature review thereby analyzing what various authors have written about the topic. This was done by looking into different books. Data was collected using a self-administered questionnaire and interviews. The study was conducted using 30 respondents among, administration and employees in Jonfran Hygienic Services. The results from the findings indicated that the major forms of financial reporting include petty cash flow, sales day book and inventory report and financial reports can result in reduction of costs of capital and that the stake holders in the organization are affected in case of inaccurate reporting. The challenges faced in financial reporting include fraudulent financial reporting, unreliable book keepers who are deceitful, and lack of data transparency. Finally, a number of recommendations were suggested such as organizations should redesign there financial reporting systems aimed at reducing cost, improving speed, and providing services consistently throughout the organization. It was also recommended that the organizations emphasize higher usage of computerized accounting ad reporting systems because of their flexibility to fit organizational needs and eliminates the inaccuracies in financial reporting