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Unit 5: Social Reporting
Environmental Contribution: Activities directed towards alleviating or preventing Notes
environmental deterioration (pollution), i.e., air, water, noise pollution. In addition, efforts
made by the organisation in conservation of scarce resources and disposal of waste, etc.,
are included.
Product or Service Contribution: This includes product quality, product safety, etc.
Notes Limitations of Social Reporting
Though the importance of social reporting is being recognised by many companies in
India, yet its progress is hindered due to the following reasons:
Lack of Clear-cut Definition of Social Reporting: Every enterprise adopts different
methods for measuring, reporting and evaluation social responsibility, as there is
no clear-cut definition and procedure for social reporting even.
Not Mandatory: Disclosure of social responsibility information is not presently
mandatory.
No Standard Format: There are no well-established concepts, conventions, postulate
and axioms to guide the social accountant in drafting his accounts and reporting.
Auditing Social Cost and Benefit is an Intricate Function: It is highly doubtful if
only accountancy scholars would be able to identify, document and audit the many
sided social effects of business behaviour and auditing social costs and benefits.
No Cadre of Social Auditors: As there is no separate cadre of social auditors, it is not
clear how and who will conduct such audit. This has also contributed to its slow
progress.
Social Reporting vs. Value Added Statements: Some business organisations mix
social reporting with value added statements, which to a large extent forfeits the
very purpose of social reporting.
Self Assessment
State true or false:
9. Disclosure of social responsibility information is mandatory for all organisations.
10. There are well-established concepts, conventions, postulate and axioms to guide the social
accountant in drafting accounts and reporting.
11. Some business organisations mix social reporting with value added statements.
12. Community development includes activities benefiting the general public e.g., food
programme, community improvement and financing of health services, etc.
5.4 Models Approaches of Social Disclosure
Social accounting measures and reports the social costs and benefits on account of operating
activities of a business enterprise. The following are the key models and approaches used for
reporting the social cost benefits:
1. Social statement approach: According to this approach, two statements are prepared
(i) Social Income Statement and (ii) Social Balance Sheet. The Social Income Statement
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