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Article
Publication date: 8 May 2018

David Mutua Mathuva

In Kenya, an award for reporting excellence is presented annually to the entities in the public and private sector. The purpose of this paper is to examine the characteristics of…

Abstract

Purpose

In Kenya, an award for reporting excellence is presented annually to the entities in the public and private sector. The purpose of this paper is to examine the characteristics of savings and credit cooperatives (SACCOs) that apply for the annual reporting excellence award in Kenya.

Design/methodology/approach

The study employs correlation and probit regression analyses to establish the factors which explain the decision by SACCOs to participate in the Financial Reporting (FIRE) excellence award. The study utilizes data consisting of 1,272 firm-year observations for 212 SACCOs, over the period 2008-2013.

Findings

Consistent with institutional and legitimacy theories, the results demonstrate that structural and governance variables are significant and positively associated with the decision to participate in the annual FIRE awards by SACCOs in Kenya. Similarly, larger SACCOs and those that have adopted best cooperative governance practices are more likely to participate in the annual FIRE awards. The results also reveal that SACCOs audited by the Big 4 audit firms are more likely to participate in the annual FIRE awards.

Research limitations/implications

The study focuses on the factors explaining the decision to participate in the annual reporting excellence awards by organizations in a specific sector. Further studies can adopt a multi-sectoral approach to investigate the same phenomenon.

Practical implications

The findings highlight the importance of cooperative governance and resources in explaining why SACCOs choose to participate in the FIRE awards.

Originality/value

The study adds onto the dearth of literature on the aspect under focus. Globally, very few studies have examined the drivers of the decision to participate in reporting excellence awards by organizations.

Details

Journal of Accounting in Emerging Economies, vol. 8 no. 2
Type: Research Article
ISSN: 2042-1168

Keywords

Article
Publication date: 14 September 2010

N. Rowbottom and A. Lymer

The purpose of this paper is to explore who uses narrative reporting information contained within online corporate annual reports and assess the relative use of different types of…

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Abstract

Purpose

The purpose of this paper is to explore who uses narrative reporting information contained within online corporate annual reports and assess the relative use of different types of narrative information.

Design/methodology/approach

Web server logs were used to analyse over one million instances where information is successfully delivered to users of the corporate web sites of 15 FTSE 350 companies.

Findings

The most frequent users of the online annual report are, respectively, private individuals, those registered under internet service providers, employees and professional investors/creditors. The results suggest that those with greater experience and expertise in preparing and using financial accounts adopt different information preferences with respect to the online annual report. Although experienced users such as professional investors, creditors and accounting firms use the annual report to download predominantly detailed financial accounting data, the widespread availability and accessibility of the online annual report allows narratives to provide a source of general company information for employees and a wider stakeholder audience.

Originality/value

The paper presents the first large‐scale survey into the use and users of online annual reports.

Details

Journal of Applied Accounting Research, vol. 11 no. 2
Type: Research Article
ISSN: 0967-5426

Keywords

Article
Publication date: 4 August 2021

Fei Song and Jianan Zhou

This paper addresses the role of principles-based accounting standards as a potential mechanism for reducing firms' time delay of annual reporting disclosure while improving the…

Abstract

Purpose

This paper addresses the role of principles-based accounting standards as a potential mechanism for reducing firms' time delay of annual reporting disclosure while improving the timeliness of accounting information. The paper also contributes to the existing literature by addressing the mediating effects of the financial reporting complexity and the audit workload on the link between principles-based accounting standards and the time delay of annual reporting disclosure.

Design/methodology/approach

The focus is placed on an unbalanced panel of 20,943 samples over the period of 2007–2017.

Findings

The results show that the more principles-based the accounting standards are, the lower the time delay of annual reporting disclosure is, and the timelier the disclosure of accounting information is. The relationship between the two is more significant especially in the first two months after the end of the fiscal year. The findings are all robust after controlling for a series of sensitivity checks and endogenous concerns. From the mediating effect results, the authors find that principles-based accounting standards decrease the financial reporting complexity and the audit workload which in turn can help lower time delay of annual reporting disclosure. In addition, the negative effect of principles-based accounting standards on the time delay of annual reporting disclosure is more significant in the case that the company has “good news” including with no losses and receiving the standard auditing opinions. The results confirm the law of “good news announces early, bad news announces late.” Furthermore, the moderating effect results show that the higher the economic policy uncertainty index and the legal environment index, the lower the benefit of principles-based accounting standards to the timeliness of annual reports. The results of the economic consequences of timeliness suggest that the timely disclosure of accounting reporting will bring greater market reaction and contain more information, and the information of companies that disclose annual reports timely are more transparent.

Originality/value

This paper studies the impact of accounting standards on the timeliness of annual report disclosure, which enriches the literature in the field of macro policies and micro-enterprise behaviors.

Details

Asian Review of Accounting, vol. 29 no. 3
Type: Research Article
ISSN: 1321-7348

Keywords

Article
Publication date: 18 August 2021

Hyoung Joo Lim and Dafydd Mali

Human capital is considered by many to be a firm's most important asset. However, because no international human capital reporting framework exists, firms can decide to…

Abstract

Purpose

Human capital is considered by many to be a firm's most important asset. However, because no international human capital reporting framework exists, firms can decide to include/exclude human capital details on annual reports. Based on legitimacy theory, firms that disclose high levels of human capital information can be considered congruent with the expectations of society. However, firms can also choose to include human capital information on annual reports for symbolic purposes as an image management strategy.

Design/methodology/approach

Using 2018 as a sample period, content analysis is used to evaluate the annual reports of the 25 largest British and 25 largest Korean firms to demonstrate the propensity of British/Korean firms to disclose human capital information as numerical and textual data.

Findings

The authors report that South Korean firms provide high levels of human capital information using narrative and numerical data, including value added human capital elements included on integrated reports. British firms on the other hand tend to use primarily positive narrative and limited numerical human capital data to present human capital information.

Originality/value

The results imply South Korean firms provide robust human capital information on annual reports as a legitimacy strategy. On the other hand, the UK's human capital reporting requirement can be considered as a form of image management. The results therefore have important policy implications for legislators, labour unions and firm stakeholders with incentives to enhance human capital information transparency.

Details

Journal of Intellectual Capital, vol. 23 no. 6
Type: Research Article
ISSN: 1469-1930

Keywords

Article
Publication date: 30 June 2022

Arash Arianpoor and Zahra Sahoor

This study aims to mainly explore the impact of business strategy and annual reports readability on financial reporting quality in Tehran Stock Exchange (TSE).

Abstract

Purpose

This study aims to mainly explore the impact of business strategy and annual reports readability on financial reporting quality in Tehran Stock Exchange (TSE).

Design/methodology/approach

The sample comprised 160 companies listed in TSE from 2014 to 2020. Five proxies (including two accounting-based attributes and two market-based attributes) were used to measure financial reporting quality. In this study, cost leadership and differentiation strategies were considered and Fog index was used to measure the annual report readability.

Findings

The results showed that in all methods of calculating financial reporting quality, cost leadership strategy, differentiation strategy and annual report readability had a positive and significant impact on financial reporting quality. Also, only at the high level of the differentiation strategy, the annual reports readability influenced financial reporting quality. In addition, at all levels of high and low annual report readability, cost leadership strategy affected financial reporting quality, but only in companies with a high annual report readability, the differentiation strategy affected financial reporting quality. Only for companies with a low readability, the annual report readability affected financial reporting quality.

Originality/value

To the best of the authors’ knowledge, no study had examined the impact of business strategy and annual report readability on financial reporting quality at the core of the present study. Furthermore, little was known about the strategic choices made in Iran. So, the research filled this gap in TSE. This study provided insights for policymakers to enhance the readability and reduce the complexity of annual reports.

Details

Journal of Asia Business Studies, vol. 17 no. 3
Type: Research Article
ISSN: 1558-7894

Keywords

Article
Publication date: 30 September 2021

Saman Bandara and Michael Falta

This paper aims to examine differential perceptions of lenders and investors on (1) the use, perceived usefulness, importance and adequacy of annual reports, (2) the importance of…

Abstract

Purpose

This paper aims to examine differential perceptions of lenders and investors on (1) the use, perceived usefulness, importance and adequacy of annual reports, (2) the importance of qualitative characteristics (QCs) and (3) the perceived impact of International Financial Reporting Standards (IFRS) on financial reporting quality (FRQ) in Sri Lanka.

Design/methodology/approach

A questionnaire survey study of practising professionals consisting of Sri Lankan investors (N = 214) and lenders (N = 235).

Findings

In relation to (1), lenders and investors rank three out of ten information sources ahead of the remaining seven: both include annual reports and personal knowledge. However, the highest average response for lenders is direct communication with clients, and for investors, it is stock market publications. Within annual reports, both decision-makers identify financial statements as the most useful part. Concerning (2), they both identified understandability as the most important QC followed by timeliness. Relevance ranked last, surprisingly. In relation to (3), both groups perceived that the new IFRS reporting environment improved the FRQ compared to the previous Sri Lanka Accounting Standards regime.

Practical implications

Ranking understandability as the most important QC in terms of decision usefulness contradicts IASB's categorisation. The authors provide empirical data on the perceived degree of success of adopting IFRS in a developing economy.

Originality/value

The authors design a decision-oriented (lending vs investing) and context-specific (IASB's financial reporting framework) questionnaire to examine the perceptions of key capital providers separately on the issues mentioned above in “Purpose” within a developing economy. The survey fits into two aspects of the decision-useful theory: useful to make what decisions and useful to whom.

Details

Asian Review of Accounting, vol. 29 no. 4
Type: Research Article
ISSN: 1321-7348

Keywords

Article
Publication date: 28 October 2014

Annika Schneider, Grant Samkin and Howard Davey

The purpose of this paper is to establish whether local authorities in New Zealand report biodiversity-related information and to examine the vehicles through which it is…

Abstract

Purpose

The purpose of this paper is to establish whether local authorities in New Zealand report biodiversity-related information and to examine the vehicles through which it is communicated.

Design/methodology/approach

This paper uses a keyword search to identify biodiversity reporting across a wide range of data sources, including local authority websites, formal accountability documents, environmental reports, environment and biodiversity management strategies, plans and policies.

Findings

Biodiversity-related information was contained in range of documents. Reporting ranged from no mention of the term in existing statutory accountability documents (Annual Plans, Annual Reports, Long-Term Plans [LTPs] and District Plans/Regional Policy Statements), through to a comprehensive stand-alone biodiversity Annual Report and stand-alone biodiversity strategies. Regional and unitary authorities were more likely than territorial authorities to prepare and report biodiversity-related information to stakeholders. There is currently no consistent framework or method to guide local authorities in the presentation of biodiversity-related information. The lack of consistent, comparable information hinders the ability of stakeholders to assess local authority performance in the sustainable management of biodiversity in their district or region.

Research limitations/implications

While this study does not consider quality of reporting, or reporting trends over time, it provides a picture of the “current state of play”. This provides a starting point from which further research into the preparation and reporting of biodiversity information by local authorities can be conducted.

Originality/value

This paper represents the first of its kind within a New Zealand context. It provides an initial insight into whether local authorities prepare and report biodiversity-related information and where this information is presented.

Details

Sustainability Accounting, Management and Policy Journal, vol. 5 no. 4
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 1 December 2004

Alex Douglas, John Doris and Brian Johnson

This paper proposes a four‐state framework for measuring corporate social responsibility reporting and argues that TQM or excellent organisations should be in an advanced state of…

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Abstract

This paper proposes a four‐state framework for measuring corporate social responsibility reporting and argues that TQM or excellent organisations should be in an advanced state of social responsiveness, and that this should be reflected in their reporting of such activities. A study of six Irish financial institutions is used to demonstrate the extent of social reporting in company annual reports and Web sites with a view to positioning them on the framework. Social reporting in the annual reports is compared with four European “best practice” financial institutions as well as the organisations' Web sites. Analysis shows that Irish banks are well behind the leading European banks with regard to the quality and quantity of social disclosure in their annual reports. It further shows that they disclose a greater volume of social information on their Web sites than in their annual reports. Reasons for such poor performance are attributed to the voluntary nature of social disclosure in Ireland.

Details

The TQM Magazine, vol. 16 no. 6
Type: Research Article
ISSN: 0954-478X

Keywords

Article
Publication date: 8 February 2016

Richard Slack and Matthias Munz

A change in leadership can signal a shift in corporate strategy to drive future value creation. To help achieve this, a different emphasis may be placed upon the intellectual…

1698

Abstract

Purpose

A change in leadership can signal a shift in corporate strategy to drive future value creation. To help achieve this, a different emphasis may be placed upon the intellectual capital (IC) resources within the organisation. The purpose of this paper is to examine the changes in volume, composition and emphasis of IC disclosure in annual reports mapped against the re-orientation of corporate strategy and associated leadership change.

Design/methodology/approach

A longitudinal period of over three decades (1979-2010) is examined. Adopting a case-based approach, Daimler AG is purposively selected for this research having a number of distinct changes in strategy over the period, reflective of leadership change. Using content analysis, annual report IC-related disclosures (structural, relational and human capital) by Daimler AG are examined, by category and more detailed sub-categories, against corporate strategy.

Findings

The composition and emphasis of IC disclosures found in the annual reports changes over the longitudinal period and is reflective of the prevailing corporate strategy at that time. There were four identified periods of strategy, each associated with leadership change. The prevalence and qualitative focus of IC disclosures relevant to each period reflects the importance of respective IC components in corporate value creation.

Research limitations/implications

The research is based on annual report IC disclosures within one case company and hence reflect the messages conveyed by that company over the longitudinal period. Additionally, the authors recognise that the annual report is only one source of corporate information, but as a historic record it serves to consistently capture management disclosure over a long-time period. Future research, adopting an econometric approach, could further test the linkages between leadership change, strategic shift and IC-related disclosure.

Practical implications

The research reveals how IC-related disclosure shifts to reflect leadership and strategic change within a case company. Through such disclosure, the authors are able to gain greater insight into how a specific business seeks to create value drawing on the components of IC underpinning corporate strategy.

Originality/value

The research provides new insights into IC disclosure by mapping its content and emphasis against changes in corporate strategy. This has contemporary significance due to the wider disclosure debate concerning strategy and value creation in the annual report, for instance through integrated reporting. Further, the research shows the value of annual reports for longitudinal disclosure research.

Details

Journal of Applied Accounting Research, vol. 17 no. 1
Type: Research Article
ISSN: 0967-5426

Keywords

Article
Publication date: 1 February 2004

CHRISTINA BOEDKER, JAMES GUTHRIE and SURESH CUGANESAN

The disclosure of information on organisational knowledge resources and related knowledge management (KM) activities in annual reports has become a much debated issue within the…

Abstract

The disclosure of information on organisational knowledge resources and related knowledge management (KM) activities in annual reports has become a much debated issue within the intellectual capital (IC) discourse. This paper discusses the disclosure of IC information, and in particularly human capital information, in an Australian public sector organisation's annual reports. It contrasts and compares the case study organisation's internal IC management issues and practices with its external IC reporting practices. The empirical analysis demonstrates inconsistency between the organisation's internal IC management issues and practices and its external IC reporting practices. It shows that strategically important information about the organisation's management challenges, knowledge resources, KM activities and IC indicators was not disclosed to external stakeholders in the organisation's annual reports. The study exemplifies to external stakeholders the significance of the provision of information on IC and, in particular human capital, and highlights to public policy makers the relevance of extending existing reporting policies to incorporate disclosure requirements for organisations to include information on IC in annual reports.

Details

Journal of Human Resource Costing & Accounting, vol. 8 no. 2
Type: Research Article
ISSN: 1401-338X

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