Value creation process (integrated reporting)
The value creation process explains how an organisation uses resources and relationships through its activities to produce outputs and outcomes affecting the capitals over time. The effects can create, preserve or erode value, and can differ between the organisation and others. Analysis should connect the business model, external environment, governance and strategy rather than treat accounting profit as the whole story.
Worked example
A new service method reduces wasted materials and improves reliability but requires staff development and new equipment. The explanation connects these changes with resources used, customer outcomes and future capability.
Common mistake
Do not confuse an output, such as a delivered service, with every resulting outcome or assume that higher reported profit proves positive effects on all capitals.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | SBL | Direct | September 2026–June 2027 |