Abstract
What are the components of the ‘disclosure regime’ in Nepal that require the mandatory disclosures by banks and financial institutions? The objective of this paper was to explore and trace the rules, regulations, and provisions governing disclosure by banks and finance companies listed on Nepal Stock Exchange. The banks and financial institutions had a two-pronged regulatory and monitoring regime requiring them to make disclosures: one as a financial institution and another as a public company. The disclosure regime comprised of accounting standards, directives from Nepal Rastra Bank (NRB), listing requirements of Nepal Stock Exchange (NEPSE), provisions of Companies Act 2006 and Banks and Financial Institutions Act 2006, and requirements placed by Securities Board of Nepal (SEBON). The study makes a significant contribution in understanding the disclosure expectations from banks and financial institutions in a developing country like Nepal.
Highlights
Corporate disclosure is a purposeful release of information by a corporate in the form of financial or nonfinancial, mandatory or voluntary, via formal or other channels (Gibbins, Richardson, and Waterhouse 1990) including special reports covering social responsibility, environment, intellectual capital, and other initiatives of a corporate. Williams (2008) described financial disclosures as: providing quantitative information in the financial statements; business segment information; financial review information; foreign currency information; and stock price information
The disclosure regime comprised of accounting standards, directives from Nepal Rastra Bank (NRB), listing requirements of Nepal Stock Exchange (NEPSE), provisions of Companies Act 2006 and Banks and Financial Institutions Act 2006, and requirements placed by Securities Board of Nepal (SEBON)
Even after controlling for the effects of other influential factors, the results show a positive and significant impact suggesting that corporate disclosure practices improved as a result of the enforcement regime introduced by the Financial Reporting Act (FRA)
Summary
Corporate disclosure is a purposeful release of information by a corporate in the form of financial or nonfinancial, mandatory or voluntary, via formal or other channels (Gibbins, Richardson, and Waterhouse 1990) including special reports covering social responsibility, environment, intellectual capital, and other initiatives of a corporate. Williams (2008) described financial disclosures as: providing quantitative information in the financial statements; business segment information; financial review information; foreign currency information; and stock price information. Owusu-Ansah (1998) explained that mandatory disclosures were limited to providing essential financial or nonfinancial information in compliance to disclosure regimes. Stakeholder’s demand for more speedy and timely information, over the years, has carved a role for the Internet, as a means of disclosure (Aly, Simon, and Hussainey 2010) and it has become an alternative medium for timely disclosure by companies (Abdelsalam and El-Masry 2008). The objective of this qualitative research was to explore and trace the rules, regulations, and provisions governing disclosure by banks and finance companies listed on Nepal Stock Exchange. The third section discusses the institutional setup and disclosure regime applicable to banks and financial institutions in Nepal. The fourth section provides the findings, contributions, implications and suggestions for further research
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
