Impact of Information Technology on Corporate Governance and Financial Reporting

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The introduction of the computer and advent of the Internet has changed the way we live in the modern world. This spans across every aspect of human life. Modern innovations have led to the description of the age in which we live as “the Information age”. Information technology and management therefore plays a vital role to the extent that timely access to Information could save a life while improper management of Information could lead to huge problems and losses of opportunities. In terms of Corporate governance and financial reporting, the financial implications of these losses could be great on corporate entities when quantified in
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Corporate image and reputation are discrete but related concepts. While corporate image is the effigy that people have of a company, corporate reputation on the other hand represents a value judgement that people make about an entity as a whole or one or more of its attributes. Corporate images typically can be fashioned fairly quikly through specific actions and well conceived communication programs, whereas reputations evolve overtime as a result of consistent performance.
Clearly an entity must be concerned about its image and reputation amongst its constituent groups which to a large extent is determened by Corporate governance. In academic parlance, these significant constituent groups are called stakeholders. They are groups that have a stake in a Company. Stakeholders are affected by the actions of the Company and perhaps more importantly, their actions can affect the company. This establishes the central importance of Corporate governance and the principal stakeholders with which most large firms must be concerned are: i. Customers ii. Distributors and retailers iii. Financial Institutions and analysts iv. Shareholders v. Government regulatory agencies vi. Social action organizations vii. The general public viii. Employees

The objective in corporate governance is to manage businesses effectively and to communicate the performance and financial position to the audiences that are important to the firm in a manner that is both
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