The document discusses social responsibility accounting (SRA), which involves voluntary reporting of non-financial information like employee welfare, environmental protection, and community initiatives. It notes challenges with SRA disclosure like a lack of legislation and uniform standards. The document also outlines objectives of SRA, areas of reporting, advantages, and ways to improve SRA disclosure practices.

1. Social Responsibility
Accounting
(SRA)

2. Definition
•Reporting of individual items like employee welfare, human resources
development, energy, environmental protection, anti pollution as well as
health and safety measures, adopted by a company usually on an ad-hoc
basis.
•Voluntary disclosure of information both of qualitative and quantitative
nature made to influence a wide range of audiences.
•Reporting of (quantifiable) cost and benefit arising from economic
activities, which are substantially received by the community at large.
i.e. the community outside the reporting entity or agency SRA can be seen
as the reporting of non-financial matters usually on a voluntary basis to all
members of society.

3. Objectives
1) To enable the public of users to
make decision which are
environmentally sensitive
2) Maximizing the return on their
investment or capital invested

4. Areas of SRA Reporting
1) Environmental protection measures
2) Employee related information including detail
about health & safety
3) Product safety
4) Reduce / conserve energy usage or
consumption
5) R&D efforts (important of company product &
services)
6) Community related projects / charities

5. SRA Disclosure
1) Who disclosure SRA information
- Main board of KLSE such As Tenaga
National, Maybank, Shell Malaysia and DRB
Hicom, etc
2) Where is SRA information disclosure
- By use of graphics like photograph, pie chart,
line graphs in order to enhance the quality of
the disclosure

6. Problem with SRA disclosure
1) Lack of legislation to entire or mandate
SRA disclosure.
2) Lack of uniformity and acceptance as to
content and style in disclosure
3) Disclosure lack credibility since they are
mostly qualitative in nature
4) The problem of limited budgets & lack
of specialized knowledge

7. Suggestion with disclosure
• Accountant should help to formulate the
specific or standard reporting system social
responsibility.
• Set up guidelines on areas that should be
included on SRA reporting.
• The introductory of social audits i.e. special
audits for the purpose.
• The production of environmental or social
responsibility accounts and balance sheet.

8. Advantages of SRA
• SRA acts as a device to transfer
information to the publics, vice-versa.
• Shareholders are able to make decision
from the information gathered.
• The publics and the company itself will
benefited economically.
• SRA rely on quantitative and qualitative
information as well.

9. Ethics and Social Responsibility
• Understanding Ethics
- Ethical behavior is important to ensure the
successfulness of the organization
- Important to ensure that the accounting
information reported can be trusted
- Ethical challenge the competency to make
ethical decision
• Social Responsibility
- Becoming more prevalent / common today due to
social awareness of the environment.
- A social audit is can be the way of analyzing the
organization successfulness

10. Environmental / Social Reporting In
Islamic Perspective
1)
Focus Areas Stakeholders Issues
Relationship of Employees Hiring & firing, wages &
the firm to its working condition,
employees privacy
Relationship of Firm Conflict of interest,
employees to the secrecy, honesty etc.
firm
Relationship of -Suppliers -Cost of inputs
the firm to key -Buyers -Selling strategy etc
stakeholders -Debtors -Repayment terms etc
-Fair competition etc
-Stakeholders

11. 2)
Focus Area Natural Environment Issues
Relationship Treatment of animals Application for
between animals
human being
and natural
environment
Environmental Applies to public
pollution safety and
hazards
3) General Social Welfare – benefit the society as a
whole

12. NATIONAL ANNUAL CORPORATE
REPORT AWARDS (NACRA)
Objectives
• To promote greater & more effective
communication
• To recognized & encourage excellence in the
presentation
• To create public awareness of the objective
• To promote higher standards of corporate
governance

13. NACRA
• Has grown from strength to strength since its
inception in 1990
• Recognized as the benchmark for excellent in
corporate reporting
• Promotes greater corporate accountability
• The code of corporate governance has set a
standard
• Cannot treat the company as personal property
• Challenge is for countries to attract capital both
from home & abroad

14. PRINCIPLES OF EXCELLENGE
• Transparency
• Integrity
• Accountability
• Effective board of director
• Sound system of internal control
• Independence & effectiveness of external
auditing
• High quality financial reporting

15. ADJUDICATION
1. Preliminary screening criteria:
• Promptness of publication
• Unmodified auditor’s report
• Compliance with approved accounting standard
• Available of annual report in Bahasa Malaysia
• No public sanction
• Not under section 176 scheme or KLSE PN4
• At least 3 years fin highlights & historical summary
• Name of co. secretary, reg. add. & registrar’s add

16. 2. Detailed Adjudication
• First stage
Annual reports will be assessed within industry
groups.
• Second stage
Those report which are nominated by the industry
group adjudicators for the Overall Excellence
Award
• Assessment of annual reports
Assessment of annual reports will be carried out by
a panel of more than 70 adjudicators