ASPECTS OF COMPANY PERFORMANCE ANALYSIS BASED ON RELEVANT FINANCIAL INFORMATION AND NONFINANCIAL INFORMATION

Abstract

The main objective of our work is the conceptual description of the performance of an economic entity in financial and non-financial terms. During our approach we have shown that it is not sufficient to analyze the performance of a company only in financial terms as the performance reflected in financial reports sometimes do not coincide with the real situation of the company. In this case the cause of the differences has to be found among the influences of other nonfinancial information. Mainly following the great financial scandals the distrust in the reliability of financial-accounting information has eroded strongly and thus the business performance measurement cannot be the exclusive domain of the criteria of financial analysis, but must be done in a comprehensive way, based both on financial criteria and on non-financial ones (intangible assets, social responsibility of the company). Using non-financial criteria have led to the occurrence of new types of analysis, namely extra-financial analysis. Thus, enterprise performance is not subject to material and financial resources managed and controlled by the entities, but to the complex of intangible resources that companies created by thier previous work. The extra-financial analysis has to face difficulties arising mainly from the existence of non-financial indicators very little normalized, and from the lack of uniformity of the practice in the field. In determining the extra-financial performance indicators one has to observe the manifestation and the evolution of the company’s relationships with its partners / environment. In order to analyze the performance measurement by financial and nonfinancial indicators we chose as a case study a company in Bihor county, listed on Bucharest Stock Exchange. The results of our study show that the Romanian entities are increasingly interested in measuring performance and after the extra-financial analysis we concluded that the company had set targets appropriate for adopting a responsible behavior, aimed at a sustainable development of the entity.

Keywords

• accounting information, relevance, performance, financial information, non-financial information