The Financial Statement Presentation

Model of Communication
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INTRODUCTION

The purpose of this study is to develop a model of

communication that applies to accounting practice.
Specifically, it aims to address the communication problem
between accountants and creditors or investors in
presenting and interpreting financial information from
financial statements that will influence their decisions. This
paper is mainly grounded by the objective of general-
purpose financial reporting, Hans Hoogervorst's Case
Study in 2017, and Brennan and Merkl-Davies study in
2018.
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Communication
Barriers

Language Barriers
Language Barriers affect the
relationship between the
investors and the accountant
simply by using over-
complicated, unfamiliar terms.
4
Interpersonal Barriers
Communication must be a two-
way street with both parties
being open and being ready to
listen to one another.
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Perceptual Barriers Medium of Communication Barrier

The medium of communication barrier
Perceptual barriers are the
means that in reporting fin financial
mental blocks that sometimes records, it must be short and direct in
investors create because of the order to understand clearly the message.
perceptions that they have of
certain people, situations or
events around us.
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Communication Model
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FS Presentation Model of Communication

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 Source – Provide qualitative and quantitative
financial information

 Message – Used in economic decisions

 Channel – Financial statements are the product

of financial reporting

 Receiver – Interpret the given message

 Feedback – The reaction of the receiver towards

the message
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Conclusion

In the practice of the accounting profession,

communication plays a vital role in providing
quantitative information, primarily financial in
nature, about economic entities, that are intended
to be useful in making economic decisions.