Abstract
Purpose – The purpose of this study is to examine the impact of corporate governance attributes of the board of directors and audit committee on compliance with the disclosure requirements about the conversion to IFRS imposed by Capital Market Authority in Saudi Arabia. Design/methodology/approach – The sample consists of 236 firm-year observations of Saudi non-financial listed companies during the period of 2015 and 2016. Using content analysis, the disclosure score is measured by a self-constructed disclosure checklist and employs Ordinary Least Square techniques to estimate the impact of corporate governance attributes on compliance with the disclosure requirements of conversion to IFRS. Findings – The results indicate that the overall disclosure compliance is 72%. Further, the number of board of directors and audit committee meetings, and international investors are positively associated with the level of compliance with disclosure requirements regarding the conversion to IFRS, while the proportion of board of directors independence and the industry type are negatively associated with the level of compliance with disclosure requirements regarding the conversion to IFRS. Research limitations/implications – The study covers only non-financial listed companies in the period from 2015 to 2016 in the Saudi stock market. Further, this study focuses on only one disclosure mean, which is companies annual reports, without any consideration of other different means. Finally, the results of this study are subject to the limitations known about the content analysis approach, especially coding the items in the checklist. Practical implications – The results should help the regulators, enforcement bodies, and investors in Saudi Arabia to the need for further improvement in the disclosure practices and enhance the effectiveness of corporate governance. Originality/value – This study contributes by provides additional evidence about the impact of corporate governance attributes on mandatory disclosures, as the literature available on this topic is limited, especially pertaining to developing countries. Keywords: IFRS, Disclosure, Corporate Governance, Board of directors, Audit committee. DOI: 10.7176/RJFA/12-18-06 Publication date: September 30 th 2021
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