Pressemitteilung
15. Jänner 2004


The global capital markets’ demand for value-based information is growing, and the traditional entertainment & media (E&M) industry corporate financial reporting model needs to be enhanced to meet this growing demand, according to a PricewaterhouseCoopers survey. The markets are demanding a wider range of performance measures and information as part of a more comprehensive approach to determining a company’s value. The survey findings are captured in PricewaterhouseCoopers’ new report, The Path to Transparency and Value in the Entertainment and Media Industry. The survey group included more than 100 E&M corporate financial executives (CFOs and investor relations leaders), institutional investors and sell-side banking analysts. Among the key findings:

  • 80 percent of the E&M industry executives said their company’s share price falls short of its true value. One-third of the executives said their shares are strongly undervalued by the markets.
  • Investors and analysts asserted that E&M companies’ reporting practices fall short of what the market needs, and two-thirds are demanding more information about a company’s ability to generate long-term returns.
  • According to the investors and analysts, companies are also falling short on reporting in key non-traditional areas such as market share, market growth, strategic direction, quality of management and customer demographics.
Kevin Carton, Global Leader of PricewaterhouseCoopers’ E&M practice said:
“Our survey results make an important statement about the need for E&M companies to expand their view of the corporate reporting world. While all the traditional financial performance measures remain important, they are no longer enough. Companies must enhance their reporting on less-tangible and often non-financial measures, in order to paint a more holistic performance picture that will enhance transparency and drive value.”

The PricewaterhouseCoopers survey and resulting report were designed to:
  • Assess the perceptions of company executives, investors and analysts about the quality and reliability of corporate-reported performance information.
  • Identify performance measures and indicators deemed as most important by those three groups of participants.
  • Pinpoint gaps in corporate reporting in the E&M industry and determine their potential implications.
Legal and regulatory initiatives such as the Sarbanes-Oxley Act are having a major impact on corporate reporting, and stakeholder groups – such as communities, employees and nongovernmental organisations – are also taking a more active and vocal role in demanding greater transparency and accountability. Yet, there remain numerous barriers to achieving consistently higher levels of transparency and accountability in E&M corporate reporting. As the survey indicates, E&M companies are still struggling with how best to measure and communicate intangible value information, such as the quality of management. For other quantitative measures, reporting shortfalls may have more to do with insufficient or unreliable systems for generating the needed information. In still other cases, E&M company senior executives may have the necessary information but choose not to divulge it due to perceived threats to confidentiality or competitive advantage. Notwithstanding these barriers, survey respondents concurred that the rewards for enhanced reporting would be significant. 80 per cent of the investors and analysts said better disclosure is key to enhancing the credibility of management. Two-thirds of the corporate executives agreed. Commented Jeremy Booker, PricewaterhouseCoopers’ UK E&M Value Reporting Leader: “This survey shows that E&M companies have an opportunity to make significant improvements in the quality, quantity and packaging of information they gather and report to the markets. There is no room for complacency in reporting disclosures if companies wish to succeed in today’s economic climate and position themselves to build shareholder value in the future. ”


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