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1 – 10 of over 202000Camelia Iuliana Lungu, Chiraţa Caraiani and Cornelia Dascălu
This study analyses the scope of social and environmental reporting from the perspective of integrating it in financial reporting and comments on a new approach regarding the…
Abstract
Purpose
This study analyses the scope of social and environmental reporting from the perspective of integrating it in financial reporting and comments on a new approach regarding the presentation of social and environmental information in the annual reports from Romanian companies’ perspective.
Methodology
A literature review introduces and justifies the second part of the research. The latter is organised as an exploratory study based on interviews. It presents the current state of Romanian companies’ availability for reconsidering financial reporting from the perspective of corporate social responsibility.
Findings
While social and environmental involvement of Romanian companies is at an early stage, there is a basis for future development of corporate reporting by addressing social and environmental aspects. We noticed that companies have the tendency of responding rather to a mandatory framework than a voluntary one.
Research limitations
The limitations of the research are linked to the study population. The small number of Romanian companies that publicly manifest interest for social responsibility determined the choice of a qualitative instead of a quantitative research.
Social implications
The exploratory study based on the case of Romania accompanies the present state of non-financial versus financial reporting in order to highlight measurable and non-measurable, but relevant, information to be considered in a future reporting framework.
Originality of the chapter
The study advances new lines in accounting research by confronting the national and international perspectives of social and environmental reporting. Debates and arguments on the research results add value and utility to the research.
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Matthias Nnadi, Kamil Omoteso and Yi Yu
This paper provides evidence on the impact of regulatory environment on financial reporting quality of transitional economies. This study compares the financial reporting quality…
Abstract
This paper provides evidence on the impact of regulatory environment on financial reporting quality of transitional economies. This study compares the financial reporting quality of Hong Kong firms which are cross-listed in mainland China with those of Hong Kong firms cross-listed in China using specific earnings management metrics (earnings smoothing, timely loss recognition, value relevance and managing towards earnings targets) under pre- and post-IFRS regimes.
The financial reporting quality of Chinese A-share companies and Hong Kong listed companies are examined using earnings management measures. Using 2007 as base year, the study used a cumulative of −5 and +5 years of convergence experience which provide a total of 3,000 firm-year observations. In addition to regression analyses, we used the difference-in-difference analysis to check for the impact of regulatory environments on earnings management.
Through the lens of contingency theory, our results indicate that the adoption of the new substantially IFRS-convergent accounting standards in China results in better financial reporting quality evidenced by less earning management. The empirical results further shows that accounting data are more value relevant for Hong Kong listed firms, and that firms listed in China are more likely to engage in accrual-based earnings management than in real earnings management activities. We established that different earnings management practices that are seemingly tolerable in one country may not be tolerable in another due to level of differences in the regulatory environments.
The findings show that Hong Kong listed companies’ exhibit higher level of financial reporting quality than Chinese listed companies, which implies that the financial reporting quality under IFRS can be significantly different in regions with different institutional, economic and regulatory environments. The results imply that contingent factors such as country’s institutional structures, its extent of regulation and the strength of its investor protection environments impact on financial reporting quality particularly in transitional and emerging economies. As such, these factors need to be given appropriate considerations by financial reporting regulators and policy-makers interested in controlling earnings management practices among their corporations.
This study is a high impact study considering that China plays a significant role in today’s globalised economy. This study is unique as it the first, that we are aware of, to compare real earnings activities against accrual-based earnings management in pre- and post-IFRS adoption periods within the Chinese and Hong Kong financial reporting environments, distinguishing between cross-listed and non-cross-listed firms.
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The purpose of this chapter is to discuss the relation between tax reporting and financial reporting, their influence on transparency, and empirical implications.
Abstract
The purpose of this chapter is to discuss the relation between tax reporting and financial reporting, their influence on transparency, and empirical implications.
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The study aims at reviewing a synthesis of disclosure, transparency, and International Financial Reporting Standards (IFRS) implementation in an attempt to provide directions for…
Abstract
The study aims at reviewing a synthesis of disclosure, transparency, and International Financial Reporting Standards (IFRS) implementation in an attempt to provide directions for future research. Prior research overwhelmingly supports that the IFRS adoption or effective implementation of IFRS will enhance high-quality financial reporting, transparency, enhance the country’s investment environment, and foreign direct investment (FDI) (Dayanandan, Donker, Ivanof, & Karahan, 2016; Gláserová, 2013; Muniandy & Ali, 2012). However, some researchers provide conflicting evidence that developing countries implementing IFRS are probably not going to encounter higher FDI inflows (Gheorghe, 2009; Lasmin, 2012). It has also been argued that the IFRS adoption decreases the management earnings in countries with high levels of financial disclosure. In general, the study indicates that the adoption of IFRS has improved the financial reporting quality. The common law countries have strong rules to protect investors, strict legal enforcement, and high levels of transparency of financial information. From the extensive structured review of literature using the Scopus database tool, the study reviewed 105 articles, and in particular, the topic-related 94 articles were analysed. All 94 articles were retrieved from a range of 59 journals. Most of the articles (77 of 94) were published 2010–2018. The top five journals based on the citations are Journal of Accounting Research (187 citations), Abacus (125 citations), European Accounting Review (107 citations), Journal of Accounting and Economics (78 citations), and Accounting and Business Research (66 citations). The most-cited authors are Daske, Hail, Leuz, and Verdi (2013); Daske and Gebhardt (2006); and Brüggemann, Hitz, and Sellhorn (2013). Surprisingly, 65 of 94 articles did not utilise the theory. In particular, four theories have been used frequently: agency theory (15), economic theory (5), signalling theory (2), and accounting theory (2). The study calls for future research on the theoretical implications and policy-related research on disclosure and transparency which may inform the local and international standard setters.
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In decades since the Rio Summit, freshwater has become an increasingly prominent issue in the global arena and attention has turned to the role of the corporate sector. Various…
Abstract
In decades since the Rio Summit, freshwater has become an increasingly prominent issue in the global arena and attention has turned to the role of the corporate sector. Various (predominantly voluntary) corporate water accounting standards currently exist, from water-related components in wide-ranging sustainability standards such as the Global Reporting Initiative through to standards specifically focused on water and/or a particular industry. While academic research on adoption of these standards is sparse, initial findings reveal generally poor water reporting in terms of both quality and quantity. In future, the major areas where reporting (and standards) could be improved are the provision of site-level water information and the assessment of water risk throughout the supply chain.
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Mai Dao and Hongkang Xu
In this paper the authors aim to examine whether shareholder activism is associated with accounting reporting complexity (ARC).
Abstract
Purpose
In this paper the authors aim to examine whether shareholder activism is associated with accounting reporting complexity (ARC).
Design/methodology/approach
The authors employ ordinary least squares (OLS) and a sample of 19,530 firm-year observations (representing 3,377 unique firms) over the 2010–2019 period to test the prediction.
Findings
The authors find that firms with shareholder activism provide more complex accounting reporting. Further, both types of activism (including Concern & Dispute and Control & Discussion) are positively associated with ARC. The authors also find that the association between shareholder activism and ARC is more pronounced when the firms have a higher level of litigation risk and a higher proportion of institutional ownership. Collectively, the findings suggest that firms with shareholder activism may be under more pressure to disclose more accounting items, leading to more complex accounting reporting.
Originality/value
The study may be informative to regulators considering the costs and benefits of shareholder activism in financial reporting.
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Karen McBride, Roza Sagitova and Olga Cam
This paper explores the reporting of the Russian American Company (RAC), from 1840 to 1863. Trading in fur, company fears of animal extinctions viewed from a monetary perspective…
Abstract
Purpose
This paper explores the reporting of the Russian American Company (RAC), from 1840 to 1863. Trading in fur, company fears of animal extinctions viewed from a monetary perspective led to early extinction reporting practice. These were not altruistic reports; they were generated by a wish to use natural resources. Despite the motivations, these reports present an example of successful extinction management by a for-profit company and a workable example of emancipatory extinction accounting.
Design/methodology/approach
Using thematic analysis, this study demonstrates how moving from transparency to accountability driven accounting can assist in biodiversity reporting, by exploring this historical business case of extinction management through the lens of Atkins and Maroun's (2018) extinction framework.
Findings
The application of the framework to the RAC's set of reports indicates that this offers a viable proposal for development of extinction management, providing a reporting tool for a for-profit company.
Originality/value
Exploring RAC's reports focusing on their extinction management processes and reporting, the paper contributes to the contemporary debate on the development of extinction reporting frameworks. These historical examples of extinction accounting, show extinction management and reporting is not a unique contemporary development in accounting. The research uses historical data as the empirical foundation for exploring applicability and further development of this extinction framework.
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Martin Quinn, Alonso Moreno and Bibek Bhatta
This study aims to contribute to the relatively limited historic literature on social and environmental accounting/accountability. More specifically, the study explores accounting…
Abstract
Purpose
This study aims to contribute to the relatively limited historic literature on social and environmental accounting/accountability. More specifically, the study explores accounting and accountability for fisheries over time and determines potential legitimacy relations as conveyed through reporting.
Design/methodology/approach
A content analysis method is used to analyse a fisheries-related section of an annual report of a state-owned electricity firm for 56 years (1935/36–1993). The time frame analysed is a period when environmental or social reporting was, in general, informal and not mandated. However, accountability was established for the company under study, through the legally mandated provision of (unspecific/discretional) information about fisheries activities. A lens evoking legitimacy relationships as a dyad is utilised.
Findings
The fisheries reporting within the case organisation is an early example of recognition of the important effects of business activities on the environment and biodiversity. The findings of the analyses suggest the content aligns with what may be anticipated in a contemporary setting. Drawing on trends noted from the content analysis, three potential legitimacy relationships are identified around the fisheries reporting. Only one is determined as a complete legitimacy relationship.
Research limitations/implications
The research is limited in that it is an analysis of one case in a single context. Also, the content analysis methods used were developed specifically for the study, which may limit their application. Finally, the data source used, and the historic nature of the study, to some extent limits the ability to determine some legitimacy relationships.
Originality/value
This study offers some insights on the historic nature of environmental reporting from a fisheries perspective in the Northern Hemisphere. The longitudinal nature of the analysis also offers insights into how the content of the reporting changed over time. Additionally, the use of a relatively new approach to operationalising legitimacy may prove useful for future researchers in the accounting discipline, especially given recent concerns on how the concept of legitimacy has been utilised in such research.
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Neeveditah Pariag-Maraye, Teerooven Soobaroyen, Oren Mooneeapen and Oorvashi Panchoo
This study investigates non-government organisations' (NGO) current accounting and reporting practices in a developing economy context (Mauritius) and argues the case for reforms…
Abstract
Purpose
This study investigates non-government organisations' (NGO) current accounting and reporting practices in a developing economy context (Mauritius) and argues the case for reforms to enhance their transparency and accountability.
Design/methodology/approach
A content analysis of a sample of NGO annual returns was carried out followed by interviews with NGO officers and actors on the state of accounting and reporting practices in Mauritius. The authors analyse the data from a public accountability perspective.
Findings
The content analysis revealed poor accounting and reporting practices by Mauritian NGOs. Based on interview insights, the authors find that these poor practices arise due a lack of (1) NGO-specific accounting standards, (2) engagement with narrative reporting, (3) properly trained NGO officers and (4) proper monitoring and control. Some of the interviewees expressed their support for introducing online filing systems and accounting requirements that are commensurate with NGO size, improving regulatory oversight, while ensuring that NGO accounts are made available to the public.
Originality/value
While there are many calls for better NGO accountability and transparency in developing economies, little is known about the state of accounting and reporting mechanisms (and regulatory framework thereof) that could provide the basis for relevant reforms towards enhancing accountability. Considering the opacity of NGO information in Mauritius and recent concerns about money laundering practices and the perceived ineffectiveness of regulatory oversight, this first national assessment of accounting and reporting practices sheds light on current challenges and formulates locally appropriate recommendations for the sector.
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Jelena Poljašević, Vesna Vašiček and Tatjana Jovanović
The purpose of this paper is to analyze the application of budgeting and accounting bases and their relation to financial accounting reporting systems through a comparative survey…
Abstract
Purpose
The purpose of this paper is to analyze the application of budgeting and accounting bases and their relation to financial accounting reporting systems through a comparative survey of three South-Eastern European countries (Slovenia, Croatia and Bosnia and Herzegovina – the Entity of the Republic of Srpska).
Design/methodology/approach
The in-depth analysis based on the study of related literature and comprehensive review of existing indicators of accounting systems leads to the identification and characterization of the most important components of the government accounting systems’ focusing also on the information usefulness in the decision-making processes.
Findings
Dual reporting based on different bases is the main feature of the accounting information system of selected countries. Budgetary reports based on a cash basis represent the primary source of information for decision making. Selected jurisdictions started with the preparation and presentation of financial reports based on the accrual/modified accrual basis which was not the result of the informational needs of decision-makers, so the information themselves have become their own purpose.
Practical implications
By exploring the opportunities and obstacles in the implementation of the accrual basis in the selected countries, the paper contributes to the development of the EPSAS project.
Originality/value
This paper contributes to the literature on the application of various budgeting and accounting bases, with an emphasis on research of the similarities and differences of the reporting methods, for the purpose of distinguishing more easily two basic types of reports and, consequently, identifying their appropriate use.
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