Voluntary disclosure of listed banks operating in Ghana

Philemon Adjei Koduah

doi:10.4038/ijabf.v6i1.48

Abstract

Issues of voluntary disclosure have become relevant in Ghana after the Bank of Ghana took steps to rationalised banks in Ghana to strengthen the banking sector. The sudden collapse of some banks in Ghana may have raised some doubts among investors and other stakeholders with regards to the quality of information disclosed by banks in Ghana. It has therefore become important for banks in Ghana to improve the quality of financial information by setting up good governance structures and to provide adequate voluntary information in their annual reports to boost the confidence of investors and other stakeholders. This study examines the extent to which listed banks in Ghana voluntarily disclose information in their annual report for the 2018 period and to determine the differences in the types of information voluntarily disclosed by listed banks in Ghana. This study revealed an overall voluntary disclosure level mean of 0.6294 which was slightly above average. The Tukey post hoc test showed a statistical significant difference between strategic information and non-financial information as well as a statistical significant difference between strategic information and financial information. However, there is no statistical significant difference between non-financial information and financial information. The study concludes that adequate voluntary information must be provided in the annual reports of listed banks in Ghana to ensure transparency, consistency, reliability and comparability to influence the economic decision needs of investors and other users of accounting information.

Highlights

Companies desire to raise capital from investors in the capital market necessitates the provision of voluntary accounting information (Choi, 1973)
The overall total voluntary disclosure level mean of 0.6294 is an indication that voluntary disclosure level among listed banks operating in Ghana was slightly above average
Access Bank Ghana Ltd made the highest level of overall voluntary disclosure with mean of 0.7203 followed by Standard

Summary

Introduction

Companies desire to raise capital from investors in the capital market necessitates the provision of voluntary accounting information (Choi, 1973). This motivate companies to willingly provide excess non statutory information in their annual report to be useful to several stakeholders (such as owners of the business, potential shareholders, bankers, people in academia, financial advisors, the general public etc.) in making economic and investment decision. Providing reports and the variations in the types of adequate voluntary details assist users to voluntary details disclosed to assist have a fair view of what goes on in a potential shareholders and other accounting company and benefit companies and the users in making informed economic general economy of a country as well as decisions. The rationalisation of the banking sector resulted in some banks been merged whereas other banks had their licences revoked and this may have raised doubts among investors as well as other stakeholders with regards to quality of details disclosed by these banks

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Conclusion