Financial Reporting HSBC Bank Essay

HSBC curse is a branch of HSBC Holdings plc and has its headquarters based in London. The marge provides a wide range of monetary products and services to individuals, governments, non-governmental giving medications and companies. It provides banking products and services in the domestic as swell as the world-wide market (Gianaris, 2001). HSBC conclave of banks is maven of the organizations of its kind that offers the largest banking and fiscal services wholly over the world. The gild has 8,500 offices in 86 countries and territories in Europe, Hong Kong, Asia, Middle East, North America and Latin America.The order has been listed in the stock exchange markets of London, Hong Kong, bleak York, Paris, and Bermuda (Jao, 2001). The come with has just about 220,000 sh areholders in 119 countries and territories. The company provides a wide range of products to its over one hundred million customers. The company has four categories of customer groups and businesses Persona l monetary serve, Commercial Banking, Global Banking and Markets and private Banking (Gardener & Versluijs, 2001). Financial reporting is the process of pile up the formal records of the pecuniary activities of an organization or an individual.It involves preparing the fiscal statements of a company. The organization aims at finding out its monetary military position in the picayune run or in the ache run period. The HSBC bank prepares its financial reports according to the gener all toldy accepted accounting principles of Canada (Mcmenamin, 1999). Financial inform biography The company prepares financial reports annually, semi-annually and every quarter. The company files meanwhile reports after every tercet or six months, that is, semi annual and quarterly financial reports.These reports bring on the financial performance of the company for the stipulated period of time (Das, 2004). The companies linked with HSBC bank are required to prepare semi-annual reports. On t he other hand, quarterly reports are not compulsory for all countries. Regulations regarding the format of stave reports differ in each country. The interim reports may be short or long depending with the country. The examine for filing the interim reports similarly vary with the different countries (Pietrobelli, Ffrench-Davis, Zamagni, & Ocampo, 2000).The muniment of preparing interim reports by the bank outhouse be traced back to the mid-year of 2002. The quarterly reports started being in operation with the first quarter of year 2003. The financial reports are essential to the researchers and that is why the company requires adequate filing of all financial statements of the bank (Mcmenamin, 1999). The company maintains timely preparation of its financial reports. It uses clear crawler technology to track and update the financial records. The corpse of preparing financial reports is very functional since it uses PDF format.This computer program allows the documents to be searched easily and can be copied into other documents more easily. The size of the PDF documents allows them to be downloaded more easily. The financial reports are presented in full-color native PDF for ease in reading them. The interim reports are easily obtained through the Global Reports Library on seek and Markets (Pietrobelli, Ffrench-Davis, Zamagni, & Ocampo, 2000). The accounting policies of the HSBC bank comply with the supranational Financial Reporting Standards.The interim amalgamate financial statements are prepared according to IAS 34, according to International Accounting Standards Board (IASB) and the European Union (EU) (Das, 2004). The bank has abandoned the IAS 32 since March 2009 since this standard required the bank to offer its shareholders rights so that they could be identified as derivative financial liability. This was done to ensure that the reports presented position of the bank as being true and reliable, also, to ensure that the reports give a true and fair view of the assets, liabilities, financial position and profit or loss of the company (Jao, 2001).The International Financial Reporting Standards (IFRSs) endorsed by the IASB may differ with those endorsed by the EU. But recently there have been no amendments on the standards endorsed by IFRS and those endorsed by the EU. The IFRSs make up the standards provided by IASB and the interpretations provided by International Financial Reporting Interpretations citizens committee (IFRIC). The interim consolidated financial statements must(prenominal) include comparative information. This is a requirement by the IAS 34, UK revealing and Transparency Rules and the Hong Kong listing rules (Gianaris, 2001).Estimates and assumptions about the future state of financial personal business are used when preparing financial information. The estimates are prepared from the information in stock(predicate) as well as use of judgment of the people preparing them. However, the substantive results might be different from the estimates in the future (Pietrobelli, Ffrench-Davis, Zamagni, & Ocampo, 2000). The interim consolidated financial statements of the bank consolidate the financial statements of HSBC Holdings and its subsidiaries. The company adopts the revised and amend standards of IASB and endorsed by the EU.The application of the revised standards is done as per the acquisition date of the business or after the beginning of the first annual financial period of the year (Pietrobelli, Ffrench-Davis, Zamagni, & Ocampo, 2000). Accounting Policies Interest income and expense- This refers to all financial instruments pull out for those classified as held for trading or designated at fair entertain in the income statement using the legal interest method. Through the effective interest method, the financial liability is calculated and interest income is al find over the relevant period (Gianaris, 2001).Non-interest income- This comprises the Net trading income whic h is composed of all gains and losses from changes in the fair value of financial assets and financial liabilities held for trading as well as the related interest income, expense and dividends. Net income from financial instruments designated at fair value and dividend income also comprises the non interest income (Jao, 2001). Segment reporting- The HSBC holdings conduct its businesses in several countries and offer a wide range of consumer products. Segment income and expenses must be transferred accordingly.Gains and losses for each segment must be accounted for separately so as to carry out the profitability of each (Das, 2004). Determination of fair value. Fair value of financial liabilities is determined using the quoted market prices where useable or using valuation techniques. The fair values include appraisal of market participant concerning the appropriate credit spread to apply to the liabilities of the company (Gianaris, 2001). Loans and advances to banks and customers - These include loans and advances initiated by HSBC which are not grouped as every held for trading or designated at fair value.Loans and advances are recognized when notes is advanced to borrowers (Gardener, & Versluijs, 2001). Impairment of loans and advances. Losses for impaired loans are recognized when there is objective evidence that the loans have been impaired. Impaired loans are recorded as charges to the income statement. Losses expected from future events are not recognized (Jao, 2001). unified Governance Analysis The bank has established commitments to maintain high standards of collective governance. Over the last financial year, the bank has maintained compliance with the have Code on Corporate Governance released by the Financial Reporting Council.It has also complied with the Code on Corporate Governance Practices in auxiliary 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong trammel (Pietrobelli, Ffrench-Davis, Zamagni, & Ocampo, 2000). The management of HSBC bank has appointed several committees to deal with several incarnate activities of the bank. The board committees consist of directors, group managing directors and co-opted non-director members. The principal committees are Group steering Board, Group Audit Committee, Remuneration Committee, Nomination Committee and Corporate Sustainability Committee (Das, 2004).The directors have the duty to conduct internal declare within the bank. They also review how effective the internal control system is operating. Controls have been intentional to safeguard assets from unauthorized use and disposal. These controls ensure that proper financial accounts are maintained and that the financial information contained in the records is reliable. The system of internal control is designed to prevent frauds, errors, material misstatement or losses in the business.The system also ensures compliance with rules set up by the Financial Services Authority, which i s the body which regulates the activities of HSBC (Jao, 2001). There are corporate policies to safeguard the bank against in operation(p) and Reputational risks. The bank has set up procedures to ensure that the risks are minimized. These risks are pertain with the issues relating to the environment, social and governance activities. The bank follows guidelines provided by the Association of British insurers concerning the go around response to the issues continueing the company and its stakeholders (Das, 2004).The company aims at managing the risks associated with the health and sentry duty standards of its operations. The bank is responsible to get rid of risks concerning fire, injury and accidents that may affect its workers and visitors. Group Corporate Real Estate sets up the rules concerning health and preventive of the company. The implementation of these policies is done by Health, Safety and Fire Coordinators who are located in every country the bank operates. The ban k has tolerateed prepared to defend its employees from terrorists.There are security review functions which have been set up to assist manage health and safety of the staff, assets and buildings of the company (Gianaris, 2001). The bank maintains a good communication network with its stakeholders. Individual and institutional customers are regularly informed about the operations of the bank. Timely response to the customer call for is given a priority to ensure good relationship is maintained. one-year general meetings are held to ensure that all stakeholders are informed of all activities of the bank over a given period of time (Gardener, & Versluijs, 2001). stopping point The general organization of HSBC company stands no doubt that it will remain successful in the future. The corporate governance ensures that the mission and vision of the company are achieved. The accounting policies of the bank are in compliance with the international standards. The accounting policies ensu re that the accounting procedures are carried out in a professional manner. The company has performed well in the market and if it continues with these strategies it will achieve much. References Mcmenamin, J, 1999, Financial Management An Introduction.Routledge. London. Pietrobelli, C, Ffrench-Davis, R, Zamagni, S, & Ocampo, J, A, 2000, Financial Globalization and the Emerging Economies, United Nations. Santiago. Jao, C, Y, 2001, The Asiatic Financial Crisis and the Ordeal of Hong Kong. Quorum Books. Westport, CT. Das, D, K. 2004, Financial Globalization and the Emerging Market Economies. Routledge. parvenue York. Gianaris, N, V, 2001, Globalization A Financial Approach. Praeger Publishers. Westport, CT. Gardener, E, P, M, & Versluijs, P, C, 2001, Bank Strategies and Challenges in the New Europe. Palgrave. New York.