Financial Information Providers Research Articles

Determinan Internet Financial Reporting pada Perusahaan Manufaktur di Bursa Efek Indonesia

The use of the internet in the era of revolution 4.0 currently affects the traditional form of information presentation for companies. Technological developments, especially the internet, create opportunities to expand information dissemination through company websites in the form of up-to-date information in order to reduce information asymmetry in a company. This research aims to provide transparency and accountability to company stakeholders, including investors, employees, auditors and customers. One of the impacts of the internet for accountants is the emergence of IFR or online-based financial information providers. Internet Financial Reporting causes financial reporting to be easily accessible to anyone and can be traced for accuracy for investors. Thus, it is necessary to know the determining factors that encourage why companies need to implement IFR as a medium of communication with investors. This study used a sample of 85 manufacturing companies listed on the Indonesia Stock Exchange from 2018 to 2021. The method used in this research is regression analysis, simple regression coefficient test (t test), and simultaneous regression test (F test) to find out what factors affect IFR. The variables used in this study are company size, profitability, liquidity, leverage, audit committee and audit quality. The results showed the variables that had a significant effect on IFR were company size and leverage of 0.000 and 0.031, while the variables of profitability, liquidity, audit committee and audit quality had no significant effect on internet financial reporting.

Investigation of the mediating role of real earnings smoothing in the relationship between financial distress and the use of trade credit

Taking into account the premise of rational expectations and the necessity of allocative efficiency, financial resources are expected to flow in the direction that would create the most efficiency. Also, given the asymmetry of information and the ethical risk raised between the providers of financial information and its users, external users are expected to have the required and sufficient knowledge of the final product of the financial reporting process, i.e., audited financial statements, the quality of financial statements, and the possibility of biased reporting, and also to optimally use the information contained in it for their economic decisions. Financially distressed firms are naturally expected to lose the trust of suppliers, and suppliers are reluctant to grant trade credit to such firms. The statistical population of the present research consists of all the companies listed on the Tehran Stock Exchange that have submitted their financial statements during the period of 1390 to 1400 (2011 to 2021). The present research, therefore, can also be helpful for standard-setting institutions (auditing organizations) to develop standards concerning the conditions by considering the financial situation of companies such as financial distress as exceptional conditions that may distort the effective implementation of some accounting standards. They can also revise and make adjustments to the stricter accounting rules affecting earnings management, especially in situations where managers are under a lot of pressure.

Efeito da atenção do investidor na eficiência do mercado brasileiro de ações

ABSTRACT The objective of this article was to evaluate the relationship between investor attention, both professional and non-professional, and the efficiency of the Brazilian stock market, as measured by the predictability of daily returns. The role of investor attention in the capital market is a controversial issue, since some studies show that it is capable of inducing efficiency, while others point out that it essentially contributes to greater volatility due to behavioral biases. This study contributes to the behavioral finance literature by pioneering the analysis of the effect of investor attention on Brazilian stock prices. Moreover, we found no previous studies that compare the effect of investor attention on market efficiency across investor classes, as measured by access to different financial information providers. The analysis of investor attention, as measured by the volume of searches on the internet, is relevant given the growing abundance of data and digital inclusion. The evidence of an effect of attention on market efficiency contributes to the critique of this classical hypothesis. The methodology consisted of estimating autoregressive models using daily data from 2018 to 2021 on search volume, returns, and transaction volume for Brazilian stocks, including the interaction between returns and search volume, to assess the influence of attention on price dynamics. In this work, we find that in the Brazilian stock market, investor attention contributes to greater market efficiency, as measured by lower predictability of returns, but the most pronounced effect comes from the attention of non-professional investors. Understanding how attention affects the incorporation of information into prices contributes to a critique of the market efficiency hypothesis, as well as allowing for profits to be made by exploiting opportunities based on the level of attention of a particular class of investors.

A dynamic factor model applied to investor sentiment in the European context

This paper proposes an Investor Sentiment Index for the European market and tests its predictability power over returns and volatility. The constructed Investor Sentiment Index for Europe draws upon three well-established and two recent individual sentiment proxies through a novel dynamic factor modeling addressed to behavioral finance. The index is obtained through an extended period of analysis and validated with other sentiment index measures. The work relies on individual sentiment proxies based on a dynamic factor model and tests it using a TGARCH model for volatility and returns. It carries out an in-sample and out-of-sample analysis to examine this sentiment index’s forecasting power over returns sustained on a recursive rolling window prediction against Fama and French’s three-factor model. The findings demonstrate that the proposed index closely predicts STOXX600 variance and returns and confirms a strong spillover effect between European and US stock markets. This study also concludes that the proposed European Sentiment Index is a valid alternative method for investors to monitor and predict market behaviors. The developed sentiment measure is a vital market prediction movement tool for financial information providers, investors, bankers, and financial analysts. The research combines the sentiment index with a TGARCH approach over the extended period of analysis and validates the method with other sentiment index measures. An in-sample and out-of-sample study confirms the predictive power of this work’s sentiment over returns compared to Fama and French’s three-factor model. AcknowledgmentThis work is funded by National Funds through the FCT – Foundation for Science and Technology, I.P., within the scope of the project Refª UIDB/05583/2020. Furthermore, we would like to thank the Research Centre in Digital Services (CISeD) and the Polytechnic of Viseu for their support.

The Reliability of Spanish and German Electricity Forward Prices. Databases and Price Discovery Process

Given the existence of different databases from different sources that offer information on forward electricity prices, the need to compare them arises to guarantee that research results and trading decisions based on them are not sensitive to the database used. We worked with forward electricity prices traded over the counter, closest month to maturity, covering the period from 2010 to 2016 for the Spanish over the counter (OTC) market, and from 2008 to 2016 for the German OTC market. The goal of this paper was to test whether there were significant discrepancies between the price series provided by two of the main agencies of financial information (Thomson Reuters and Bloomberg), as well as to analyze the existence of causality relationships between them, both in the long-term and in the short-term. As a first step, we obtained the data availability and the distributional characteristics of each of the price series offered by the mentioned financial information providers for the Spanish and the German electricity OTC market. Then we studied the lead-lag relationship between two price series, previously chosen as representative of those provided by Thomson Reuters and Bloomberg, to ascertain if there are any leading databases that may systematically anticipate information with respect to the others.

What citizens want to know about their government's finances: Closing the information gap

There is an information gap between citizens and their governments when it comes to government finances. The inherent complexity of fiscal policy makes it exceedingly difficult for effective public participation. Effective public participation in fiscal decision making must address informing or educating the citizenry with accurate and meaningful government financial data. Better understanding citizen wants and perceptions is critical to closing the information gap between users and providers of financial information. This study uses information gathered from focus groups with residents of Norfolk, Virginia that asks what government financial information they want and how to make that information useful. Results suggest that citizens are interested in some types of information over others and that such information must be timely, made relevant and contextualized.

Prioritize activists in Iran information accounting system based on the actor's network theory (ANT)

Abstract. Nowadays it is safe to say that every management decision has the financial implications in the following and due to this the management needs financial information to take any decision. The task of preparing this information and processing them on financial issues is due to the informational accounting systems. The issue that why managers accept a series of accounting information and use them, or on the contrary, don't accept it and don't use it, is the most important information issues of managers. On the other hand a large group of users of accounting information rely on the information that is provided by the managers in the form of financial statements and explanatory notes. In many cases, the purpose of financial information providers is not the same as their users and these issue origins from conflicts of interest among stakeholders in the company. Therefore, to reduce the conflict of interest groups benefit, users of accounting information, they needs the services of competent and independent experts for the accreditation of the accounting information and identifying the way of communication between systems components so that they will believe the above information. In this study, the effect of the 5 main instrument to form a network of activists is including the organization's rules and regulations, financial resources, human resources and technology as a main means of influencing on the accounting information system of Iran was reviewed and prioritized. According to the results of this study it was determined that the actor network theory as a theory of social science information system is capable to examine and explain the accounting system of Iran. As well as in the implementation and successful implementation of accounting information systems, prioritizing organizational actors first and then to the technical, economic actors, social-political actors located reactive technology.

Young people's perceptions of the responsibilities of organizations promoting financial capability

AbstractToday's changing market environment demands financial capability even from young consumers. This article concentrates on the perceptions of young people on the roles and responsibilities of school, public, private and non‐profit sector actors in promoting financial capability among the young. The qualitative data were collected via focus group discussions among young people aged 15–26 in schools and education institutions across Finland. Educational institutions play an important role in the everyday lives of the young but tend to focus on macro‐finance issues in financial education. Banks are seen as professional actors promoting financial capability to the young, but their activities are recognized as profit driven. Public sector and non‐profit organizations are less familiar to young people as providers of financial information but are considered impartial and reliable. It is apparently difficult for young people to differentiate between the activities of the various parties offering financial advice. They would welcome finance‐related information from several actors and from different perspectives. Financial education and financial matters are only interesting to the young when topical. In order to promote a financial capability among young people, the actors involved should become more proactive and cooperate with each other.

Intersectoral interagency partnerships to promote financial capability in older people

From the second quarter of 2008, the UK economy entered a period of economic decline. Older people are particularly vulnerable during these times. To promote ways in which older people can be better supported to maintain their financial well-being, this study explored the sources older people utilize to keep themselves financially informed. Interviews with older people (n = 28) showed that older people access trusted sources of information (e.g. healthcare professionals) rather than specialist financial information providers (e.g. financial advisors) which highlighted the need for interagency working between financial services in the private, public and voluntary sectors. An example of how such interagency partnerships might be achieved in practice is presented with some recommendations on directions for future research into interagency working that spans public, private and voluntary sectors.

The Analysis Of Comments Received By The BIS On Principles For Sound Liquidity Risk Management And Supervision

The market turmoil that began in mid-2007 re-emphasized the importance of liquidity to the functioning of financial markets and the banking sector. In June 2008, the Basel Committee of the Bank for International Settlements (BIS) released a consultative document on Principles for Sound Liquidity Risk Management and Supervision. Interested parties were invited to provide written comments by the end of July 2008. As a result, the Committee received many comments for publication by 30 different commenters. Our analysis first indicates that comments were formulated on each of the 17 principles discussed in the consultative document. Second, comments were also made in each of the five separate defined areas of focus covered by the 17 principles. Third, the results of our analysis reveal that opinions on different principles differed the most when commenters were separated into four distinct categories: banking trade associations, regulatory supervisors, individual financial institutions, and others (consultants, academics, accounting associations, and financial information providers). Last but not least, the results of the study indicate that commenters’ opinions, both within a category and between categories, differed the most in the two following defined areas of focus: measurement and management of liquidity risk and public disclosure of quantitative information on liquidity risk management.

Individual Investors' Attention to Accounting Information: Message Board Discussions

Accounting standard setters and financial information providers are interested in individual investors’ use of accounting information, but find it difficult to assess with conventional data sources. Financial message boards provide a unique medium to analyze individuals’ attention to accounting information on a large scale and in great detail. I examine accounting-related content in 1.94 million messages for 1,852 firms and find that individual investors pay considerable attention to accounting information. In accordance with the expectation that investors react to relevant information events, I find that accounting-related discussion is significantly elevated around earnings releases, 8-K reports, quarterly reports, and annual reports of the smallest firms. I also examine whether investors expand their accounting information acquisition and processing efforts in poor information climates. I show that accounting-related discussion increases in an environment of greater uncertainty, measured by information availability (lower analyst coverage), information precision (higher analyst forecast dispersion), and information ambiguity (higher trading volume). Lastly, I propose that greater attention to accounting information may be associated with evidence of a better-informed investor. I find that higher accounting discussion around earnings announcements is associated with an increase in the Earnings Response Coefficient and a small reduction in information asymmetry around the earnings announcement.

Commercial Insurance of Financial Disclosure: Auditors’ Independence, and Investors’ Protection

In this paper the authors propose, for preliminary consideration and discussion, a system of commercial insurance of financial disclosures (CIFD), under which users of financial information (owners and potential owners of business enterprises) and providers of financial information (managers of business enterprises) would be able to purchase insurance policies from private insurers (commercial insurance companies). These insurance policies would be designed to protect users of financial statements from specific, well-defined losses directly attributable to their use of financial disclosures that failed to conform to contractually defined standards. To reduce their own risks insurance companies will likely purchase from assurance experts (certified public accountants, financial analysts, and management consultants) services assuring adherence to standards. The paper discusses the dynamics of the decisions and negotiations within and among groups of investors, managers, insurers, assurors, and government regulators. The advantages of CIFD over current US regulation of financial disclosure are analyzed. Those advantages, which include increases in the independence of external auditors, improvements in the quality of their audits, and better protection for investors, are assessed. It is argued that CIFD may be capable of evolving into a very flexible system that would accommodate alternative regulatory structures.

The financial information value chain: repositioning accounting knowledge

Recently a body of literature has emerged from the United States that attempts to quantify and explain the role the media plays in the provision of financial information to share markets. This paper extends that line of enquiry by focusing on the implications for the accounting profession of various forms of alternative, frequently mediadriven, financial information providers. The paper briefly examines the demographic changes in the Australian share markets and adopts a ‘value chain’ approach in its analysis of the relationship between the media and the accounting profession. It highlights the growth in the media’s provision of financial information, analysis and advice and examines the response of the accounting discipline to the changes in the ‘financial information’ market. Finally, the paper suggests that for the accounting profession to maintain its members’ presence in the financial information market it will need to rigorously develop and differentiate its knowledge set to reinforce its value against the growing competition for financial advice coming from ‘new’ media. We suggest that to achieve this goal the discipline will need to develop and adopt a more holistic intradisciplinary ‘evidence based’ knowledge management system approach to maintaining and developing its knowledge set.

Competition in Markets for Information

Competition among sellers of information in a noisy rational expectation equilibrium is considered. Trader's preferences for information are explicitly characterized. It is shown that the competition on market for information makes providers of financial information to price their products in a way that leads traders to purchase all signals available. If signals are substitutes, competition pushes the price of information lower than that in monopolistic settings. However, if signals are complements, the price of an individual signal in duopoly actually exceeds the one in monopolistic settings, and information producers are involved in tacit collusion. Externalities of information lead to counterintuitive results that (a) efficiency of the competitive market for information (as measured by quality of signals offered for sale) is no better than in monopolistic setting, and (b) competition leads to no improvement on the part of the traders as providers of financial information are still able to appropriate all of the consumer surplus.

What are assets anyway? Some practical realities

Addresses the UK accounting definition of an asset from a practical, theoretical and critical perspective. It suggests that it is a flawed definition in need of change. The accounting definition (UK and US) recognises assets arising from a “transaction or event”, a basis which, inter alia, is inadequate for the task of recognising often hugely valuable, internally created assets, such as brands, software and research patents. As providers of financial information to management, the accounting profession has a duty to account for all the tangible and intangible assets of a business. However, as this paper shows, there are many practical circumstances in which it fails in this task.