The association between firm‐specific characteristics and disclosure

Abstract

Purpose – The main thrust of this paper is to assess the level of disclosure in the annual reports of non‐financial Saudi firms and to empirically investigate the hypothesized impact of several firm characteristics on the extent of voluntary disclosure.Design/methodology/approach – A disclosure checklist consisting of 20 voluntary items was developed to assess the level of disclosure in the 2003 annual reports of 40 firms, forming approximately 56 percent of the total firms incorporated in Saudi Arabia. The association between the level of disclosure and some firm characteristics was examined using multiple linear regression analysis.Findings – The results show that the mean of the disclosure index was lower than average. Also, it was found that firm size was significantly positively associated with the level of disclosure. The remaining variables, however, were found to be insignificant in explaining the variation of voluntary disclosure.Research limitations/implications – There are, however, several lim...