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Introduction: In the context of globalisation processes, the necessity to create appropriate information support for management decisions at various levels becomes increasingly important: at the international, national and enterprise levels. The source of such data is financial reporting. The last leads to increase attention from key users (investors, lenders, other users) to the reliability and quality of financial reporting data. The study of scientific literature and best foreign practices made it possible to identify problems of the theoretical, organisational and methodological background of preparing high-quality financial statements and their assessment, particularly the lack of a unified interpretation of the financial reporting quality concept. The necessity to identify a theoretical basis for assessing financial reporting quality has led to the relevance of this study.

Aim: Scientific substantiation and improvement of theoretical provisions of methodology development for financial reporting quality assessment.

Methods used within the study are the following: Analysis, synthesis, operational approach, bibliographic analysis, generalisation.

Findings: The application of an operational approach to the formulation of the definition of financial reporting quality has made it possible to create the basis for its assessment. This approach involves descriptions of the principles of clarity and uniformity. The authors define the concept of ‘financial reporting quality’, formulating the theoretical principles for financial reporting assessment as the process of establishing compliance of financial statements with a specific list of qualitative characteristics.

This study examines the relationship between financial reporting quality, Industrial Revolution 4.0 and social well-being of stakeholders among public companies in Malaysia.

The sample of the study includes 232 firm-year observations of Malaysian publicly listed companies from 2013 to 2017. Social well-being is measured using social pillar scores from the Environmental, Social and Governance (ESG) data provided by Refinitiv. The study identified companies as an adopter of IR 4.0 based on their disclosure on the use of autonomous robots, simulation, cloud, horizontal and vertical system integration, cybersecurity, additive manufacturing, augmented reality and big data analytics in their financial reports. Financial reporting quality is measured using discretionary accruals.

This study found that financial reporting quality and IR 4.0 are related to social well-being, particularly the workforce. These results imply that companies with higher adoption of IR 4.0 are more likely to provide more information concerning job satisfaction, a healthy and safe workplace, maintaining diversity, equal and development opportunities for its workforce. Furthermore, the results show that firms with lower discretionary accruals (i.e. higher quality of financial reporting) are more likely to provide more information about social well-being. The results are robust even after addressing endogeneity issues.

This research contributes new insights into the role of financial reporting quality and IR 4.0 in enhancing social well-being in Malaysia. These findings offer valuable input for regulators striving to advance the United Nations' 2030 Agenda for Sustainable Development.

This study carries substantial practical implications for policymakers and businesses alike. It underscores the importance of embracing IR 4.0 technologies and integrating them into strategic planning to foster social well-being. These insights can guide policymakers in shaping economic strategies and assist businesses in prioritizing financial reporting quality while engaging stakeholders to promote social well-being.

This is the first study to investigate the combined relationship of financial reporting quality and IR4.0 on social well-being, which provides valuable evidence in this novel domain. While previous studies have primarily explored the relationship of IR4.0 on sustainability from an environmental and human resource perspective, this study sheds light on the specific dimension of social well-being, hence promoting sustainable development goals by the United Nations in 2030.

This study aims to investigate whether there is a relationship between the religiosity levels of chairpersons’ hometowns and the financial reporting quality of companies.

Using a unique hand-collected data set obtained from various sources, the authors use ordinary least squares and logistic regressions to test the hypotheses and further implement various methods to address potential issues such as omitted variables, reverse causality and selection bias problems. In addition, the authors control for the religiosity level of chief executive officers’ (CEOs) hometowns. Finally, the authors divide the sample into two subsamples – companies with strong corporate governance and companies with weak corporate governance – to investigate the effect of chairpersons’ hometown religiosity on financial reporting quality under strong or weak corporate governance.

The findings demonstrate that companies with chairpersons from religious hometowns produce high-quality financial reports. Additional tests, such as the Heckman selection model and instrument variable regression, confirm the robustness of the main results. Controlling for the religiosity level of the CEO’s hometown yields consistent findings with the main results. Finally, additional results indicate that the religiosity levels of chairpersons’ hometowns play a significant role in enhancing financial reporting quality in companies with weak corporate governance.

Companies should consider appointing board members or chairpersons from more religious hometowns, as the empirical results of this study support the positive effects of chairpersons’ hometown religiosity on financial reporting quality.

To the best of the authors’ knowledge, the current study is among the first to demonstrate the relationship between the religiosity level of the chairpersons’ hometown and the financial reporting quality of companies. The study introduces unique hometown religiosity proxies and controls for various variables related to corporate governance, chairperson attributes, company characteristics, and audit firm characteristics.

This study aims to investigate the impact of ethical accounting practices on financial reporting quality by using the extended theory of planned behaviour (ETPB) and integrating religiosity as a moderating variable.

Using a survey method, data was obtained from 371 chartered accountants who were in good standing as of April 2023. The collected data were then analysed using partial least squares structural equation modelling.

The results revealed that there is a significant positive relationship between ethical accounting practices (attitude, subjective norm, perceived behavioural control and ethical judgement) and financial reporting quality of accounting practitioners. Furthermore, a moderation test was conducted, which demonstrated that religiosity enhances the positive correlation between ethical accounting constructs (attitude, subjective norm and ethical judgement) and financial reporting.

Leading by example, top-level management should actively promote a culture of religiosity that prioritises integrity and adherence to financial reporting requirements.

To the best of the authors’ knowledge, this is one of the very few ethics studies in accounting that demonstrates that the application of the ETPB improves financial reporting quality in a context fraught with allegations of moral breaches by accountants.

The main objective of this study is to investigate whether adoption of International Financial Reporting Standards (IFRS) improve the quality of financial reporting in Nigeria. Financial reporting quality was measured in terms of fundamental qualitative characteristics such as relevance and faithful representation and enhancing qualitative characteristics such as understandability, comparability, verifiability, and timeliness as contained in the conceptual framework. The study was conducted on a sample of 162 companies listed on the Nigerian Stock Exchange. A compound measurement tool in form of an index was developed to comprehensively assess the quality of financial reporting based on information disclosed in the financial statement of the selected companies. From both univariate and multivariate analysis, I found strong evidence suggesting that accounting standard used in the preparation of financial statement have significant influence on the quality of financial report of the reporting entity. The result persists for all the three models (overall financial reporting quality, fundamental, and enhancing qualitative characteristics) tested in this analysis. The result also revealed that apart from firm age and firm growth, most of the firm-specific variables investigated have statistically significant influence on the financial reporting quality.

The purpose of this study is to examine the association between the combined roles of chief executive officer (CEO)-chairman titles (CEO duality) and investment efficiency, defined as a lower deviation from expected investment for targeted S-curve firms used to propel an innovation-driven economy. This study also aims to investigate the moderating effect of financial reporting quality on this association.

This paper focuses on the ten targeted S-curve industries – under the definition of the Thailand 4.0 model – listed on the Stock Exchange of Thailand (SET) from 2000 to 2019. Data related to CEO/chairman titles and investment supports were manually collected from the annual reports, the SET market analysis and reporting tool database and the company websites. Financial data used to estimate investment behaviors and discretionary accruals were extracted from 1999. The study analyzes unbalanced panel data using fixed-effects regressions. Additional tests embrace replacing the sample with nontargeted firms, partitioning into granted and nongranted firms, adding CEOs’ demographic moderators, using alternative variable measures and analyzing for lagged independent variables.

The main findings show that CEO duality reduces overinvestment but worsens underinvestment in targeted firms. Financial reporting quality (FRQ) appears to strengthen CEO duality in mitigating extreme spending but has no impact on the association between CEO duality and underinvestment. Additional results, for example, conclude that CEO duality has no association with both over- and underinvesting at nontargeted firms, but its effect becomes positively significant on overinvestment when financial reporting quality is high. The negative association between CEO duality and overinvestment is found only in government-granted and targeted firms. FRQ encourages CEO duality in lowering overinvestment among targeted firms without grants. CEOs’ female and serviced early years appear to elevate those main findings.

These findings assist innovative corporations in choosing a proper leadership structure to cope with investment inefficiency. The research gives the government and regulatory bodies an insight into the qualifications of the leadership structure and financial information that helps them put forward effective policies.

To the best of the author’s knowledge, this study is among the first to establish the association between CEO duality and investment efficiency for innovation-driven firms in a transforming economy. The study fills the gap in the literature on management, accounting and finance by unveiling the interplay between dual leadership and financial reporting in affecting the efficiency of investments.

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.

This paper aims to examine the relation between SEC regulations centered on board of director independence and financial reporting quality and investigates the different routes to board independence.

The sample includes 1,248 firm observations whose board composition is compared between 2001 and 2008. Each firm is categorized based on how they increase board independence. The authors test the hypotheses using ordinary least squares regression models.

Results show that firms choose between multiple routes when complying with the independence requirements, and how firms operationalize the SEC requirement impacts financial reporting quality. Specifically, firms that achieve increased board independence through increased board size are associated with higher financial reporting quality. However, there is no association between higher financial reporting quality and a subsequent increase in audit fees. Suggesting the reporting quality results from the board monitoring function and not from an increase in auditor effort.

No evidence exists on how a firm’s chosen route to increased board independence relates to financial reporting quality.

This paper aims to review 68 archival studies on the impact of audit committees (ACs) on firms’ consequences [(non)financial reporting, performance and audit quality] in European firms.

Applying a stakeholder agency-theoretical framework, the author differentiates between three categories of AC variables: presence; composition; and resources, incentives and diligence.

The author finds that AC composition, (non)financial reporting and audit quality are dominant in the literature review. Other inputs or outputs are either too low in amount or yielded heterogeneous results, hindering clear tendencies. However, there are indications that financial expertise is positively related to financial reporting and audit quality, in line with agency theory and European regulatory assumptions.

In the discussion of potential future research, the author emphasizes, among others, the need for the recognition of innovative and sustainable AC variables, inclusion of moderator and especially mediator variables and reaction to endogeneity concerns by advanced regression models.

As the European Commission currently discusses extended regulations on AC duties and composition, this literature review highlights the huge impact of financial expertise on financial reporting and audit quality. In view of the increased monitoring duties of sustainability reporting, both business practices and regulatory bodies should increase the sustainability expertise of ACs.

This analysis makes useful contributions to prior research by focusing on attributes of AC and their impact on firms’ outputs in the European capital market, based on a differentiation between mandatory one-tier/two-tier systems and the choice model. The findings support the promotion of European evidence-based regulations, such as the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive.