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The use of visual presentations for integrated reports in the investment decision-making process

Arif Widyatama (Department of Accounting, Airlangga University, Surabaya, Indonesia) (Department of Accounting, Sekolah Tinggi Ilmu Ekonomi Panca Bhakti Palu, Palu, Indonesia)
I Made Narsa (Department of Accounting, Airlangga University, Surabaya, Indonesia)

Journal of Applied Accounting Research

ISSN: 0967-5426

Article publication date: 13 May 2022

Issue publication date: 13 January 2023

711

Abstract

Purpose

This study aims to identify the effect of the format of a presentation and the form of information on the decision-making process of non-professional investors in Indonesia. Investor behaviors, including acquisition, evaluation, weighting, judgment, and allocation decisions, are explained explicitly after taking a look at the form of the information and the way it is conveyed in various presentation formats.

Design/methodology/approach

This research used web-based experiments. It used a 2 × 2 between-subjects design. Eighty-nine selected students acted as surrogate investors. They were provided with company performance reports presented in different report formats (integrated versus non-integrated) and different forms of information (visual versus descriptive).

Findings

The results showed that information, when presented visually, is more influential on investment allocation decisions in Indonesia. In addition, the result of the post hoc test indicated that integrated reports are more influential than non-integrated reports.

Research limitations/implications

The results of this study have significant implications for companies that publish financial and non-financial disclosures. The reports are required to be presented in an integrated and visual form in order to increase the investors' level of understanding so they can comprehend a company's performance holistically.

Practical implications

It is necessary for Indonesian policymakers to create regulations regarding the presentation of financial and non-financial information in an integrated and visual way.

Originality/value

This study fills a gap in the literature on integrated reports by showing that the visualization of information in such reports increases the level of understanding that underpins investment decision-making. Furthermore, this study contributes to cognitive load theory by providing evidence that the kind of presentation of information that facilitates people's cognitive ability is not only in the narrative form but visual presentation also works.

Keywords

Citation

Widyatama, A. and Narsa, I.M. (2023), "The use of visual presentations for integrated reports in the investment decision-making process", Journal of Applied Accounting Research, Vol. 24 No. 1, pp. 106-133. https://doi.org/10.1108/JAAR-09-2021-0238

Publisher

:

Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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