The practice of non-financial reporting: Possible development trajectories

2021 ◽  
Vol 22 (7) ◽  
pp. 781-803
Author(s):  
Tat'yana N. SOLOVEI ◽  
Valeriya A. PUCHKOVA
Keyword(s):  
Financial Reporting ◽  
Reporting Quality ◽  
Scientific Publication ◽  
International Standards ◽  
Negative Effects ◽  
Financial Reports ◽  
Reporting Practices ◽  
Foreign Companies ◽  
European Experience ◽  
Development Trajectories

Subject. This article summarizes development trends in non-financial reporting and traces the current problems of its content and qualities. Objectives. The article aims to indicate key problems of the content and quality of non-financial reporting, referring to the analyzable publications and analytical reviews of corporate practices. It also aims to determine possible regulation areas of non-financial reporting practices as part of the Concept for the Development of Public Non-Financial Reporting in the Russian Federation. Methods. For the study, we used the methods of detailed description and summary, comparison, analogy, and the logic and systems approaches. We analyzed scientific publication in periodicals and analytical reviews of the Russian Union of Industrialists and Entrepreneurs, Big Four companies, focusing on the development of non-financial reporting practices. Results. The article summarizes key problems of non-financial reporting, which are typical of the Russian and foreign companies. We suggest how the regulation of non-financial reporting should be developed in Russia, referring to the European experience and corporate practices. The article provides an analysis of the non-financial reporting quality in twelve Russian companies so as to verify and identify issues of its content and quality. Conclusions. Businesses do prepare their non-financial reports in compliance with the international standards and initiatives on sustainable development. They often fail to disclose what method they use to select subjects for their reports, reluctantly giving examples of negative effects on the environment or other adverse impact of their operations. The information is not always comparable for accounting periods. Considering the experience of the European countries in the regulation of non-financial reporting, we conclude there should be conceptual principles for non-financial reporting in accordance with international standards and national distinctions.

COMPARATIVE ANALYSIS OF INTERNATIONAL STANDARDS IN THE FIELD OF NON-FINANCIAL REPORTING AND THE PRACTICE OF THEIR APPLICATION

2021 ◽  
Vol 2 (4) ◽  
pp. 146-152
Author(s):  
E. V. ANDRIANOVA ◽  
◽  
P. S. SHCHERBACHENKO ◽  
Keyword(s):  
Financial Reporting ◽  
Financial Statements ◽  
Business Environment ◽  
International Standards ◽  
Positive Trend ◽  
Financial Indicators ◽  
Additional Tool ◽  
Foreign Companies ◽  
High Level ◽  
Source Of Information

This article discusses and analyzes the most popular standards of non-financial reporting, which has a significant impact on the transformation of the business environment. Already, domestic and foreign companies with a high level of responsibility are beginning to publish non-financial statements in addition to financial statements, which is an additional tool for communication with stakeholders and a new source of information about their activities. To date, reports of this type are clearly unregulated, there are no verification standards, however, there is already a positive trend and the active introduction of non-financial indicators in the regular reporting of companies.

scholarly journals The effect of governance system and degree of convergence to IFRs on the quality of financial reporting: Evidence from Asia

2015 ◽  
Vol 12 (4) ◽  
pp. 409-423
Author(s):  
Ratna Wardhani ◽  
Sidharta Utama ◽  
Hilda Rossieta
Keyword(s):  
Corporate Governance ◽  
Financial Reporting ◽  
Reporting Quality ◽  
International Standards ◽  
Financial Reporting Quality ◽  
Governance System ◽  
Governance Practice ◽  
Corporate Governance Practice ◽  
Degree Of Convergence

This research investigates the effect of governance system and degree of convergence to IFRS on financial reporting quality. With sample of Asian countries, this study concludes that country level and firm level governance systems, both at, and the degree of convergence have positive influence on financial reporting quality.The effect of degree of convergence of local GAAP to IFRS and corporate governance practice to financial reporting quality will be stronger for companies in countries with weak investor protection. Also, we find that in company with weak corporate governance practice, the adoption of international standards will increase the quality of financial reporting.The results indicate that the adoption of international accounting standard become more important in the countries and companies with weak governance system.

scholarly journals Scientific Publication Analysis: Financial Reporting Quality Insight

2019 ◽  
Vol 8 (4) ◽  
pp. 3159-3173
Keyword(s):  
Bibliometric Analysis ◽  
Financial Reporting ◽  
Reporting Quality ◽  
Specific Area ◽  
Scientific Publication ◽  
Research Area ◽  
Research Trend ◽  
Research Association ◽  
Financial Report ◽  
Accounting Scandals

After most shocking accounting scandals happen to Enron and WorldCom, most of the countries around the globe started to analyse their existing financial standards realising the importance to have sturdy corporate governance in order to produce high quality financial report. To further understand the nature of the research topic, a broad of research association is necessary. This study focus on conducting bibliometric analysis, with the objective to determine the research trend especially in FRQ area based on total publications, co-authorship among countries and authors, and co-occurrence of authors keywords. Bibliometric analysis is a method of analysing database publication trend based on specific area such as FRQ, risk and economics. By using Scopus database, total of 396 articles is extracted between 1993 to 2018. The result suggested that, the interest on FRQ study start to bloom from 2008 and experience a steady increment until 2018. About 50 percent of the total global publication of FRQ research area was published by researchers from USA and China, leading the other countries like Indonesia, Korea and Malaysia. It is also documented that top research institute who actively publishes on FRQ research also coming from USA. The recent sub-theme of FRQ arguably focusing other area such earnings management and discretionary accruals. This study arguably important to professional bodies in their attempt to convince the directors the benefit associated by enhancing the quality of FRQ.

The Development of Accounting and Financial Reporting Practices in Sri Lanka: An Exploratory Investigation

2019 ◽  
Vol 54 (02) ◽  
pp. 1950008
Author(s):  
Jayasinghe Hewa Dulige ◽  
Nadana Abayadeera ◽  
Muhammad Jahangir Ali ◽  
Paul Mather
Keyword(s):  
Sri Lanka ◽  
Financial Reporting ◽  
Reporting Quality ◽  
Sri Lankan ◽  
Reporting Practices ◽  
Political Interference ◽  
Key Stakeholders ◽  
Exploratory Investigation ◽  
Chartered Accountants

In this paper, we examine the factors that influence the development of accounting and reporting practices in Sri Lanka in the backdrop of its political and economic environment. We find that the early days of accounting in Sri Lanka were heavily influenced by the British colonial system. Subsequently, its greatest influence was derived from the regulatory and institutional framework backed by local and British professional accounting bodies. We also interview key stakeholders to draw insights on how the institutional factors contribute to the development of financial reporting in Sri Lanka. We discover that the Institute of Chartered Accountants of Sri Lanka (ICASL) is a key player in developing and implementing accounting standards and the best financial reporting practices. We observe that although the Sri Lankan Government has undertaken many initiatives to improve the quality of financial reporting, monitoring and enforcing regulations remain weak partly due to political interference. Therefore, we suggest that strengthening the existing regulatory mechanisms will help to improve the reporting quality and build investor confidence.

Integrated reporting, financial reporting quality and cost of debt

2020 ◽  
Vol 28 (3) ◽  
pp. 517-534 ◽  
Author(s):  
Mohammad Badrul Muttakin ◽  
Dessalegn Mihret ◽  
Tesfaye Taddese Lemma ◽  
Arifur Khan
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Reporting Quality ◽  
Financial Reporting Quality ◽  
Cost Of Debt ◽  
Inverse Association ◽  
Integrated Reporting ◽  
Financial Reports ◽  
Content Type ◽  
Debt Market

Purpose Although proponents of integrated reporting (IR) advocate that this emerging practice has the potential to transform corporate reporting, the eventuation of this expectation would depend on the incentive IR provides to firms. This study aims to examine whether IR is associated with cost of debt and whether IR moderates the relationship between financial reporting quality and cost of debt. Design/methodology/approach Based on insights drawn from information asymmetry and agency theories, the authors develop models that link IR and financial reporting quality with a firm’s cost of debt. The authors analyze 847 firm-year observations drawn from non-financial firms traded on the Johannesburg Stock Exchange, for the period between 2009 and 2015. Findings The authors find that firms that provide integrated reports tend to have a lower cost of debt than those do not provide IR. The authors also find an inverse association between financial reporting quality and cost of debt, and that integrated reports accentuate this association. The findings suggest that the debt market perceives value in the information presented in integrated reports beyond what is furnished in financial reports. Originality/value To the best of the authors’ knowledge, this study is the first to document evidence suggesting that the debt market perceives value in the information presented in integrated reports, beyond what is furnished in financial reports.

scholarly journals Venture Capital and Financial Reporting in Newly Public Firms

2018 ◽  
pp. 411-429
Author(s):  
Lars Helge Hass ◽  
Monika Tarsalewska
Keyword(s):  
Earnings Management ◽  
Empirical Evidence ◽  
Financial Reporting ◽  
Reporting Quality ◽  
Active Role ◽  
Real Earnings Management ◽  
Venture Capitalists ◽  
Public Firms ◽  
Reporting Practices

Financial intermediaries such as venture capitalists (VCs) not only provide financing, they also play an active role in firm governance and in financial practices before a firm goes public. Venture capitalists are actively engaged in monitoring and advising their portfolio firms. Thus, one also expects them to exert significant influence over the development of financial reporting practices. This chapter reviews recent literature and empirical evidence on VCs and financial reporting quality in newly public firms. It surveys the role of VCs in such activities as earnings management. In particular, it discusses how their monitoring activities and reputation can impact how their portfolio firms establish financial reporting practices. Subsequently, it also reviews the consequences of misreporting, and whether they affect VC behavior ex ante. Finally, the chapter uses recent data to provide empirical evidence on the effect of VCs on accrual and real earnings management.

scholarly journals The impact of corporate governance mechanisms and IFRS on earning management in Saudi Arabia

Accounting ◽  
2021 ◽  
pp. 207-224
Author(s):  
Abdulwahid A. Hashed ◽  
Faozi A. Almaqtari
Keyword(s):  
Corporate Governance ◽  
Saudi Arabia ◽  
Financial Reporting ◽  
Audit Committee ◽  
Reporting Quality ◽  
Financial Reporting Quality ◽  
Earning Management ◽  
Negative Effects ◽  
Corporate Governance Mechanisms ◽  
Positive Effect

The current research seeks to assess the influence of corporate governance mechanisms and IFRS adoption on compliance with IFRS, earning management, and financial reporting quality(FRQ). A sample comprises 102 Saudi listed firms for the period spanning from 2014 up to 2019 was used. The study used descriptive statistics, correlation analysis and multivariate analysis to estimate the results. The results reveal that while board size, board meeting and foreign ownership had negative effects on compliance with IFRS, board and audit committee independence exhibited a positive effect. Further, the results demonstrate that there was a sign of earning management under IFRS when a performance magnitude was used. The results also indicate that board and audit committee size, audit committee meeting and managerial ownership had significant negative effects on financial reporting quality however, board and audit committee independence showed a significant positive effect. Importantly, the results found that FRQ under IFRS was better than Saudi GAAP. The present research provides practical implications for policy makers, stock market authority, and academicians. More regulatory and disclosure requirements have to be imposed and financial reporting supervisory board need to be formed. The present research provides a novel contribution to IFRS compliance, earning management, financial reporting quality and corporate governance literature. It has a unique contribution as it attempts to investigate this issue in the context of an emerging economy and a recent IFRS adopter; Saudi Arabia that has special country-specific characteristics. The study also provides an evidence by investigating earning management and financial reporting quality under both sets of accounting standards; IFRS and Saudi GAAP.

scholarly journals Users’ Perception of Financial Reporting Quality in Ghana

2019 ◽  
Vol 8 (3) ◽  
pp. 187
Author(s):  
Joseph Mbawuni
Keyword(s):  
Financial Reporting ◽  
Middle Management ◽  
Reporting Quality ◽  
Middle Level ◽  
Sub Saharan Africa ◽  
Cross Sectional Survey ◽  
Cross Sectional ◽  
Financial Reports ◽  
Sub Saharan ◽  
Five Dimension

This paper assesses the extent to which top and middle management perceive FRQ of companies in Ghana after the adoption of International Financial Reporting Standards (IFRS). Drawing from the literature, a five-dimension FRQ questionnaire was developed for the study. It was a cross-sectional survey that involved a sample of 500 respondents from top and middle level management across seven industries in Ghana. The findings indicate that, generally top and middle management perceive the qualitative characteristics of FRQ of the Ghanaian companies to be very good. However, Timeliness of FRQ in terms of publishing audited financial reports was the only poorly rated qualitative characteristic. Implications to accounting theory and practitioners are discussed. Moreover, there were differences in respondents’ perception of FRQ according to their work background characteristics. It was found that top and middle management who were professional accountants were more critical in their assessment and therefore rated their perceived FRQ significantly lower than those who were non-accounting professionals.  This study contributes to filling the void in FRQ literature regarding accounting information users’ assessment of FRQ in IFRS-compliant countries in Sub-Saharan Africa.

Quality reporting of corporate philanthropy

2017 ◽  
Vol 22 (4) ◽  
pp. 486-506 ◽  
Author(s):  
Carmen Valor ◽  
Grzegorz Zasuwa
Keyword(s):  
Financial Reporting ◽  
Corporate Philanthropy ◽  
Financial Reports ◽  
Content Type ◽  
Quality Reporting ◽  
Reporting Practices ◽  
Corporate Websites ◽  
Fortune 100 ◽  
Accounting Model ◽  
Corporate Social

Purpose The purpose of this paper is twofold: first, to outline a framework for corporate philanthropy (CP) reporting that could help differentiate between symbolic and substantive reporting; and second, to test whether the reporting practices of large corporate donors are symbolic or substantive. Design/methodology/approach First, to construct a framework for CP reporting, the authors draw from research on corporate social responsibility communication, CP and reputational capital-building. Second, the philanthropy disclosures found in non-financial reports of the largest donors from the list of Fortune 100 corporations were examined using content analysis. Findings The theoretical framework identifies key ingredients of disclosure quality such as goals, causes, support, partners and impacts. The empirical findings show that disclosures regarding CP are more symbolic than meaningful. The largest donors provide descriptive information regarding the CP plan that primarily focuses on projects and causes. However, they fail to provide an explicit account of their decisions and the results of their philanthropic activities. Research limitations/implications The framework could also be applied with small changes to other communication outlets including social media and corporate websites. Originality/value This paper addresses an important gap in non-financial reporting research: the lack of a CP accounting model. To the authors’ knowledge, the framework developed in this paper represents the first conceptualization of the quality of CP disclosure that may enable scholars to differentiate symbolic from substantive CP and in this way advances the debate on CP communication. This framework can also help companies sincerely engaged in philanthropy to benefit from these activities.

scholarly journals International Financial Reporting Standards (IFRS) and Reporting Quality in Nigeria: An Assessment of Selected Quoted Firms

2020 ◽  
Vol 4 (1) ◽  
pp. 11
Author(s):  
Aminu Abdullahi ◽  
Musa Yelwa Abubakar
Keyword(s):  
Financial Reporting ◽  
Descriptive Analysis ◽  
Secondary Data ◽  
Reporting Quality ◽  
Reporting Standards ◽  
Financial Reports ◽  
Information Reduction ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Audit Firms

This study investigates the effect of IFRS adoption on reporting quality in Nigeria. Secondary data were sourced from financial reports of a sample of 79 quoted Nigerian firms, with the help of Nimegen Centre for Economics (NiCE) qualitative reporting index for reporting quality. The study covered a period of 10 years, i.e. 2007 to 2011 as SAS regime and 2012 to 2016 IFRS regime. ANOVA test and descriptive analysis, were utilised for the analysis. The study concludes that, IFRS adoption has made significant positive difference in the extent of reporting quality. It is recommended that Nigerian firms should adopt appropriate measures to improve the level of relevance, comparability and verifiability of their financial reports through provision of more forward looking information, reduction in the use of technical jargons and appointment of more reputable audit firms.

Sign in / Sign up

Export Citation Format

Share Document