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Determinants of disclosures of A‐, B‐ and H‐share companies

Jinghui Liu (School of Commerce, The University of Adelaide, Adelaide, Australia)
Ian Alexander Eddie (School of Business and Governance, The University of Canberra, Canberra, Australia)

Asian Review of Accounting

ISSN: 1321-7348

Article publication date: 16 January 2007

1119

Abstract

Purpose

This study attempts to examine the issues relating to corporate financial reporting of Chinese listed companies under specified institutional settings as companies with different share‐categories are required to prepare annual reports under various General Accepted Accounting Principles (GAAP).

Design/methodology/approach

This study selects Chinese companies that issue negotiable shares to examine whether corporate disclosure patterns are different under various institutional settings. Negotiable shares can be traded on stock exchanges and are divided into A‐, B‐ and H‐shares. The extent of corporate disclosure is obtained from the content analysis of annual reports for 191 sampled Chinese listed companies with various share categories. The association are hypothesized and tested between the level of corporate disclosure and the following corporate determinants: company size, profitability, auditor, leverage, industry and ownership structure.

Findings

The extensive regulations and different standards influence on disclosures of companies with foreign investment participation and overseas listing status. By reconciliation of their annual reports according to the IFRSs or the GAAP of the listing country, these companies increased information disclosure voluntarily in order to enhance their reputation and credibility. Some corporate factors, such as company size, profitability and the size of auditor, have influenced the level of corporate disclosure in annual reports of domestic and foreign share‐based companies. Ownership structure has positive impact on the level of disclosure for companies with domestic investors.

Originality/value

This study advances knowledge of the influence that legislative circumstances and ownership structures can have on disclosure decisions made by management in their annual reports. This information is of high interest to domestic and foreign investors and regulators in understanding of financial reporting in Chinese listed companies.

Keywords

Citation

Liu, J. and Alexander Eddie, I. (2007), "Determinants of disclosures of A‐, B‐ and H‐share companies", Asian Review of Accounting, Vol. 15 No. 1, pp. 72-92. https://doi.org/10.1108/13217340710763762

Publisher

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Emerald Group Publishing Limited

Copyright © 2007, Emerald Group Publishing Limited

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