An investigation of perceptions of company annual report users in Sri Lanka

Abstract

Purpose

The purpose of this paper is to report on a study of how users of company annual reports in the emerging market of Sri Lanka view those reports. Since limited studies exist that examine financial reporting practices in emerging markets, little is known about the user perceptions of company annual reports in these markets. This paper contributes to filling this gap by examining the views of a wide spectrum of users on the usefulness of corporate annual reports in Sri Lanka.

Design/methodology/approach

The data reported in this study were collected through a questionnaire survey, covering seven user groups – accountants, executives, bankers, tax officers, academics, financial analysts, and investors. The 264 responses received were analysed using the Kruskal‐Wallis one‐way ANOVA test.

Findings

The results reveal that most use annual reports for obtaining information for share transactions. Despite the long delay in publishing many annual reports and lack of availability of these reports to the general public, the majority of users view annual reports as the most important source of company information. The paper also reveals that, in comparison with developed markets, Sri Lankan users depend more on annual report information than on information provided by stockbrokers, newspapers, and other media reviews.

Originality/value

This paper provides information about the usefulness of annual reports in an emerging market, Sri Lanka. No prior research on this aspect of Sri Lankan companies is reported in the literature.

Citation

De Zoysa, A. and Rudkin, K. (2010), "An investigation of perceptions of company annual report users in Sri Lanka", International Journal of Emerging Markets, Vol. 5 No. 2, pp. 183-202. https://doi.org/10.1108/17468801011031810