scholarly journals Forward-looking Disclosures in Integrated Reporting: Evidence from Poland

2021 ◽  
Vol XXIV (Issue 4B) ◽  
pp. 952-981
Author(s):  
Boguslawa Bek-Gaik ◽  
Anna Surowiec
Keyword(s):  
Integrated Reporting ◽  
Forward Looking

Modifying assurance practices to meet the needs of integrated reporting

2018 ◽  
Vol 31 (2) ◽  
pp. 400-427 ◽  
Author(s):  
Warren Maroun
Keyword(s):  
Financial Reporting ◽  
Business Models ◽  
Analytical Techniques ◽  
Published Data ◽  
Integrated Reporting ◽  
Test Procedures ◽  
Content Type ◽  
International Integrated Reporting Council ◽  
Integrated Or ◽  
Forward Looking

Purpose Traditional methods of assurance outlined by current professional standards are risk-based models where the emphasis is on the veracity of published data rather than on the rigour of the interpretation or analysis of information provided to users. As such, they are not well suited for expressing an opinion on qualitative, subjective or forward-looking assessments typically included in integrated reports. In this context, the purpose of this paper is to describe an alternate approach to assurance and identifies the initial elements of an “interpretive assurance model”. Design/methodology/approach The research is exploratory/interpretive. It relies on detailed interviews with experienced auditors and preparers to develop an initial approach for providing some level of assurance over an integrated report. Findings The research identifies elements of an interpretive assurance model which focusses on providing assurance on the interpretation and analysis of information included in an integrated report rather than on underlying data. These include an examination of the completeness of the explanation of the value creation process provided in an integrated report; the methods used to support management discussion and analysis; and the reasonability of the review process used to ensure the reliability of qualitative, subjective and forward-looking representations contained in an integrated report. Research limitations/implications The study is conducted in a South African setting. While limiting the study to a single jurisdiction may be seen as a limitation, local preparers and auditors have had at least five years of experience with the application of an integrated reporting framework and are in a strong position to provide detailed insights. Practical implications An interpretive assurance model shifts the focus from objective verification of data using defined test procedures to evaluation of the interpretation and analysis process used to prepare an integrated report. Application of the proposed model will require practitioners and auditing students to be trained extensively in qualitative analytical techniques. The inherent complexity of contemporary business models and the multi-dimensional focus of integrated reports will also result in changes in the composition of audit teams which are currently dominated by experts in financial reporting rather than integrated or strategic business management. Originality/value The paper is the first to offer a practical approach for providing assurance over an integrated report. It responds to calls form the International Integrated Reporting Council and International Auditing and Assurance Standards Board for more innovative assurance models for addressing the reporting needs of contemporary organisations.

Determinants of forward-looking disclosures in integrated reporting

2018 ◽  
Vol 33 (1) ◽  
pp. 115-144 ◽  
Author(s):  
Merve Kılıç ◽  
Cemil Kuzey
Keyword(s):  
Content Analysis ◽  
Design Methodology ◽  
Gender Diversity ◽  
Ordinary Least Squares ◽  
Board Composition ◽  
Least Squares Regression ◽  
Integrated Reporting ◽  
Content Type ◽  
Early Adopters ◽  
Forward Looking

Purpose This paper aims to examine the nature and extent of forward-looking disclosures in early examples of integrated reporting and to investigate the determinants of those disclosures. Design/methodology/approach The sample for research involved 55 non-financial companies whose reports are available in the Integrated Reporting Examples Database for the year 2014. The authors used content analysis to investigate the quantitative and qualitative forward-looking disclosures among early adopters of integrated reporting. The forward-looking disclosure index (FLDI) was categorized into two main groups, quantitative and qualitative, including 30 items in total. Multivariate ordinary least squares regression was used to investigate the associations proposed in the research hypotheses. Findings The authors determined that the majority of the entities tended to provide qualitative forward-looking disclosures rather than quantitative. Further, the findings showed that gender diversity and firm size are positively related to forward-looking disclosures, whereas leverage is negatively related to forward-looking disclosures. Contrary to expectations, the authors did not find a significant impact created by board size, board composition, profitability or industry on forward-looking disclosures. Originality/value The research contributes to the current integrated reporting and forward-looking disclosure literature. To the best of the authors’ knowledge, there is no prior study that has investigated forward-looking disclosures in integrated reports. This study contributes to the current literature by examining the determinants of forward-looking disclosures by categorizing them as quantitative and qualitative. Further, this research adds empirical findings to the literature on the association found between female directors and forward-looking disclosures.

scholarly journals Developing forward-looking orientation in integrated reporting

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Martin H. Kunc ◽  
Maria Cleofe Giorgino ◽  
Federico Barnabè
Keyword(s):  
Future Orientation ◽  
Quantitative Information ◽  
Integrated Reporting ◽  
Resource Based View ◽  
Content Type ◽  
Additional Information ◽  
Information Gap ◽  
The Future ◽  
Forward Looking

Purpose According to the “strategic focus and future orientation” principle of the integrated reporting (<IR>) framework, <IR> should provide information useful to support investors in assessing the future financial performance of organizations. This study aims to support the operationalization of this function by improving the forward-looking orientation of the integrated report. Design/methodology/approach Basing on the backward- and forward-looking disclosure in <IR> and the dynamic resource-based view (DRBV), this study develops an explorative case study building a quantitative simulation model based on an integrated report. Findings This study provides useful insights into how operationalizing the <IR> “future orientation” and obtaining more quantitative information on the organization’s capacity to create value in the future by applying DRBV and quantitative simulation modeling. Research limitations/implications The article presents one case study to explore the method suggested to improve the <IR> forward-looking orientation. Additional case studies applying the same research design should be certainly useful to refine the method. Practical implications Supporting the <IR> forward-looking orientation, this study provides additional information for the decision-making process of investors, thus contributing to the efficient and productive allocation of capital. Originality/value Few studies have investigated forward-looking information in integrated reports, highlighting the existence of an “information gap” referred to such disclosure. Overcoming these previous results, the study provides useful insights on how to improve the <IR> forward-looking orientation.

Exploring forward-looking information in integrated reporting

2018 ◽  
Vol 19 (1) ◽  
pp. 102-121 ◽  
Author(s):  
Elisa Menicucci
Keyword(s):  
Firm Size ◽  
Multivariate Regression Analysis ◽  
Firm Characteristics ◽  
Integrated Reporting ◽  
Content Type ◽  
Reporting Framework ◽  
Research Gap ◽  
International Integrated Reporting Council ◽  
Practical Implications ◽  
Forward Looking

Purpose The purpose of this paper is to investigate the effect of firm characteristics on forward-looking disclosure (forward-looking information (FLI)) within the context of integrated reporting (IR). The study assesses the extent of FLI provided in integrated reports and empirically fills the research gap into the topics of FLI disclosed in the IR. Design/methodology/approach A manual content analysis is run to investigate the level and the topics of FLI in 282 integrated reports available in the International Integrated Reporting Council (IIRC) website. A disclosure index composition consisting of 27 information items is developed from the list of content elements comprised in the Integrated Reporting Framework (IIRC, 2013). Three hypotheses are proposed and eight models are tested within a multivariate regression analysis in order to explore the effects of three main variables (firm size, profitability and leverage) on FLI. Findings The study confirms that firms are reluctant to provide FLI in integrated reports. The results show that profitability and firm size have a statistically significant relationship with the level of specific topics of FLI. Conversely, leverage is found to be insignificant in explaining the extent of FLI. Research limitations/implications To improve the reliability of findings presented in this study, several others may be conducted by inspecting more variables that may affect the extent of FLI or by increasing the number of companies included in the sample. Practical implications The results provide comprehensive insights into the current forward-looking disclosure practices of early adopters in integrated reports and can be a useful evidence for preparers of it. This paper has also practical implications especially for managers and regulators (e.g. IIRC) since it encourages further efforts to promote FLI if firms want that the disclosure offered in the IR is perceived as “informative” by their significant stakeholders. Originality/value The research adds to the prior disclosure literature concerning FLI since acquired results are ambiguous. There are a very restricted number of studies that have explained the variation of FLI in the light of firm characteristics and no study has analyzed this research topic within the context of IR.

scholarly journals THE EFFECT OF PROFITABILITY, CAPITAL STRUCTURE, AND FORWARD-LOOKING INFORMATION ON INVESTMENT RISK

2021 ◽  
Vol 8 (2) ◽  
pp. 147-156
Author(s):  
Muhammad Istiqlal JERICO ◽  
Wiwik UTAMI
Keyword(s):  
Capital Structure ◽  
Stock Exchange ◽  
Sample Selection ◽  
Annual Reports ◽  
Investment Risk ◽  
Integrated Reporting ◽  
Share Prices ◽  
Negative Effect ◽  
Independent Variable ◽  
Forward Looking

This study aims to provide empirical evidence of the effect of profitability, capital structure and forward looking information on investment risk. The population used in this research were all banking companies listed in the Indonesia Stock Exchange for the period 2016 to 2018. The sample selection used a random sampling method, and obtained 117 samples. The variables of profitability, capital structure, and forward-looking information refer to the elements of Integrated Reporting (2013) as an independent variable, and investment risk as the dependent variable. Data is collected from bank annual reports and share prices obtained from the website. The analysis method used is multiple linear regression. The results of the study concluded that profitability and capital structure had no effect on investment risk. Forward-looking disclosure has a negative effect on investment risk. This means that forward-looking disclosures can significantly reduce investment risk.

scholarly journals Forward-Looking Intellectual Capital Information in Integrated Reporting: An Empirical Analysis

2019 ◽  
Vol 14 (8) ◽  
pp. 167
Author(s):  
Elisa Menicucci ◽  
Guido Paolucci
Keyword(s):  
Firm Size ◽  
Intellectual Capital ◽  
Multivariate Regression Analysis ◽  
Firm Characteristics ◽  
Integrated Reporting ◽  
Voluntary Reporting ◽  
Reporting Behaviors ◽  
International Integrated Reporting Council ◽  
Research Show ◽  
Forward Looking

The aim of the paper is to explore the amount of forward-looking intellectual capital information (FL_ICI) in Integrated Reporting (IR) and the effect of firm characteristics on FL_ICI within this context. This study empirically bridges the research gap on the issues of forward-looking information (FLI) and adds to intellectual capital (IC) disclosure research. In particular, the paper responses to two research questions specifically: what are the extent and the content of FL_ICI and what are the factors that impact on different IC voluntary reporting behaviors in IR. A content analysis is apply to inspect the subjects and the amount of FL_ICI in reports accessible in the web site of the International Integrated Reporting Council. Five Models are verified using a multivariate regression analysis to investigate the influence of three independent variables (firm size, profitability and leverage) on FL_ICI. The research proves that companies are reluctant to disclose FL_ICI in integrated reports. The findings of the research show that the majority of FL_ICI regards relational capital. The regression model also reveals that firm size and profitability have a statistically significant influence on specific topics of FL_ICI. On the contrary, leverage appears insignificant in determining the amount of FL_ICI. The research contributes to prior disclosure literature regarding forward-looking information since prior research results are unclear. There is a limited number of studies that investigated FL_ICI in relation to firm characteristics and no studies have investigated this issue within the setting of IR.

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