Looking ahead: Factors that will shape corporate reporting in 2025

Understanding the factors influencing the corporate reporting landscape in the new year is pertinent for organisations because, through this understanding, they plan and prepare how they engage with stakeholders through their various reports to meet their information needs and expectations.

Top on that list are the likely uncertainties and disruptions from geopolitical conflicts in 2025 and the impact of macroeconomic volatility.

Organisations must be prepared to navigate these complexities, from tariffs to economic shocks and disruptions.

The quality of disclosures within the financial statements and sustainability reports will be a focus area for stakeholders, particularly investors, who need to understand the impact of current and anticipated events on organisations.

For example, the disclosures accompanying valuations in the financial statements would require notes on the valuation assumptions and sensitivities.

Organisations should expect the momentum around sustainability reporting to continue into the new year as more jurisdictions issue new regulations on sustainability reporting.

Stakeholders will focus on how organisations perform regarding their sustainability targets in 2025. Therefore, organisations must be deliberate in 2025 on executing in a structured manner the different phases of their sustainability journey, from strategy to scope emissions measurement and reporting.

On the financial reporting front, organisations must apply the materiality concept appropriately to determine what aspects of the financial statements require more information.

Applying materiality is very important to avoid the temptation of information overload, which could result in immaterial disclosures obscuring material information.

Another area of focus to anticipate is the impact of the new International Financial Reporting Standards (IFRS) accounting standard, IFRS 18—Presentation and Disclosure in Financial Statements), which replaces IAS 1 and represents a fundamental change in how the income statement is presented.

Though not yet effective until January 1, 2027, organisations must anticipate investor queries on the likely impact of the new standard compared to how profit or loss is currently presented.

Therefore, organisations must begin to assess the potential changes to how their performance will be reported from 2027 to engage meaningfully with investors.

Organisations should also prepare in 2025 to make changes to their internal systems and ledgers to accommodate the new standard, including revisiting existing contracts that need to be revised based on the new subtotals in IFRS 18.

This article was first published on Business Daily and can be accessed here.