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Article
Publication date: 10 October 2018

Mostafa Kamal Hassan, Bassam Abu Abbas and Samy Nathan Garas

This paper aims to examine the relationship between the readability of annual reports and corporate performance in Qatari listed firms while controlling for a firm’s competitive…

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Abstract

Purpose

This paper aims to examine the relationship between the readability of annual reports and corporate performance in Qatari listed firms while controlling for a firm’s competitive position, governance structure and specific features such as size, age and industry type.

Design/methodology/approach

This study relies on both agency theory and legitimacy theory to develop testable hypotheses. It uses a sample of 126 firm-year listed companies in the Qatar Stock Exchange to test obfuscation in the annual reports through examining the association between the readability of Narrative Disclosures (NDs) and corporate profitability, financial risk and agency costs for the period from 2014-2016.

Findings

The findings show that firms with higher annual report readability are more profitable and have lower agency costs, which is an indication of the existence of “obfuscation.” Qatari firms may use narrative complexity as a disclosure strategy to enhance their image and consequently maintain their social legitimacy.

Research limitations/implications

Although the study findings suffer from limited global generalization, they can be generalized across Gulf Cooperation Council countries. Thus, future cross-country research is encouraged.

Practical implications

The findings encourage Qatari policymakers to instate a policy for “Plain English” writing to make NDs easy to read by international investors.

Originality/value

This study is one of very few studies that examines the readability of annual reports in emerging market economies, i.e. Qatar. The study contributes to the paucity of research that examines English-written annual reports in non-English speaking countries.

Details

Corporate Governance: The International Journal of Business in Society, vol. 19 no. 2
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 24 December 2021

Mostafa Kamal Hassan, Bassam Abu-Abbas and Hany Kamel

The authors investigate the impact of disclosure tones and financial risk on the readability of annual reports in the banking sector. The authors also examine the moderating…

Abstract

Purpose

The authors investigate the impact of disclosure tones and financial risk on the readability of annual reports in the banking sector. The authors also examine the moderating effect of banks' financial risk on the tone–readability relationship.

Design/methodology/approach

This study relies on the agency theory and the social psychology theory to formulate its testable hypotheses and explain the empirical findings. It uses a sample of 390 bank-year observations from banks listed in the Gulf Cooperation Council (GCC) Stock Exchanges during the period 2014–2019. It also employs random effect regressions to analyze the data and to examine the reverse causality/endogeneity in order to obtain robust findings.

Findings

This study’s results demonstrate that easy (difficult) to read annual reports is significantly associated with positive (negative) tone. Bank managers characterized as “too positive/optimistic” and banks with higher financial risks publish less readable annual reports. The results also show that the interaction between negative tone and a bank's financial risk is inversely associated with reading difficulty, indicating that managers prepare easy text to clarify causes of their banks’ high risks, yet they communicate this easy text with a negative tone that reflects their feelings/emotions towards the financial risks of their banks.

Practical implications

This study’s findings call for the use of a plain English text that bears a neutral tone and urge financial analysts to go beyond the financial aspects of annual reports. They also stimulate policymakers to draft policies, which ensure the presence of audit committee members who possess a broad expertise to uncover the linguistic issues embedded in the annual reports.

Originality/value

To the best of the authors' knowledge, this is the first study dedicated to exploring the tone–readability association in the GCC's banking sector.

Details

Journal of Accounting in Emerging Economies, vol. 12 no. 4
Type: Research Article
ISSN: 2042-1168

Keywords

Open Access
Article
Publication date: 11 June 2019

Mohamed Othman Elkhosht

The purpose of this paper is to draw a map of the general features of epistemological and critical concerns in contemporary Islamic philosophy. This study will not be confined to…

6443

Abstract

Purpose

The purpose of this paper is to draw a map of the general features of epistemological and critical concerns in contemporary Islamic philosophy. This study will not be confined to the domain of academic philosophy or to those who are professionals in the field of philosophy.

Design/methodology/approach

The paper adopted the critical rational approach in dealing with contemporary Islamic philosophy in the Arab world. The scope will include scholars from different fields of epistemology who tried to present a “vision” of the attitude that should be adopted in facing the challenges of the age and the problems of the nation on the epistemological level or the political, economic and social levels.

Findings

There is a need for a philosophy of action and progress rather than a philosophy that is based on abstract ideas and theories and of words/rhetoric. The ethics required to accomplish this ought to identify the attributes of the citizen who can reach self-actualization through legitimate means based on a progress agenda with theoretical and philosophical foundations.

Research limitations/implications

Because a critical rational approach can be dealt with from different perspectives, this paper will adopt the classification of the principal intellectual trends: the reformist, secular and liberal.

Practical implications

This paper covers a long time span to determine whether the philosophical projects have been effective.

Originality/value

This paper, which criticizes the philosophic projects that are theoretically unsound and that do not address real social problems (like poverty), argues the need for a philosophy of progress and action. This will lead to devising an agenda that addresses the challenges the society is facing and to finding alternative and creative solutions resulting in development.

Details

Journal of Humanities and Applied Social Sciences, vol. 1 no. 1
Type: Research Article
ISSN: 2632-279X

Keywords

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