The Hindu Business Line : Reporting variations

Typically, annual reports reflect the culture and economic climate of a company's home country. Thus write George Thomas Friedlob and Ralph E. Welton, in Keys to Reading an Annual Report, (third edition) from Westland. Companies in the US, the UK and the Netherlands focus their financial statements `on the needs of investors,' because "these countries have large markets for stocks and bonds."

In contrast, European countries often have close ties with only one source of capital, usually a large bank, one learns.

"Also, European GAAP (generally accepted accounting principles) historically has been established by law in each country and is often detailed and procedural, requiring strict compliance, with little room for judgment.

European countries often use the same law to govern both taxation and financial reporting."

How is it in South America? There, the financial statements focus on accounting for the severe inflation common in that economy, inform the authors.

How are things under communism? "There is no need to determine income and, with no need for calculating depreciation expense, fixed asset valuation is not important," explains the book.

However, with state-ownership losing its clout, "financial reporting in Eastern Europe is rapidly adopting more informative accounting standards."

Power of non-violence

Mahatma Gandhi's great achievement was to revive and implement the ancient Indian concept of non-violence in modern times, writes His Holiness the Dalai Lama in his foreword to Non-violence: The history of a dangerous idea, by Mark Kurlansky, from Jonathan Cape (www.randomhouse.co.uk). Gandhiji's practice of non-violence depended fully on the power of truth. "The recent unprecedented fall of oppressive regimes in several parts of the world has demonstrated once more that even decades of repression cannot crush people's determination to live in freedom and dignity," is more from the foreword.

For those who believe in the peace option.

Tailpiece

"We have set up a surveillance team to check... "

"If... "

"If our new surveillance software is working fine."

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D. Murali