Financial Reporting Practices Research Articles

Public Financial Reporting Practices, Regulations and Accountability of State-Owned Corporations in Kenya

Public Financial Reporting Practices, Regulations and Accountability of State-Owned Corporations in Kenya

The Effect of Gender Diversity Boards on Sustainble Financial Reporting Practices

This study aims to analyze the effect of board gender diversity on environmental, social, and governance (ESG) disclosure in Indonesia, an emerging market. Companies. This study analyzed 58 sample companies that are members of the ESG Leader Index and the IDX Kehati ESG Quality 45 Index. Based on regression analysis, the data results show that the proportion of women on the board of directors significantly reduces the company's ESG risk level. The industrial sector and the market capitalization of the company's stock also strengthen the influence of board gender diversity on the company's ESG risk level. Thus, the industrial sector contributes to the company's follow-up in designing organizational structures and implementing ESG initiatives. The higher the level of capitalization of a company's stock, the greater the company's initiative in increasing the proportion of women on the board of directors to meet the diversity requirements, thereby reducing the level of ESG risk. This study contributes to the limited but growing literature on ESG reporting quality and board gender diversity, especially in emerging economies.

Transforming Financial Reporting Practices in Bangladesh: The Benefits and Challenges of Implementing Blockchain Technology

Transforming Financial Reporting Practices in Bangladesh: The Benefits and Challenges of Implementing Blockchain Technology

Critical Review on Financial Reporting Practices by Islamic Banks: (Comparison between AAOIFI and IFRS)

This paper summarizes the findings of a comparative critical examination of the financial reporting methods of Bank Al-Barakah, BTPN Syariah, and Maybank Islamic Berhad. Due to the discrepancy between theory and practice, several past studies have found that Islamic banks need to alter the implementation of their financing facilities. This fact requires clarification. The research employs the quantitative descriptive method and theoretical with secondary data sources derived from literature research, as well as the IASB Conceptual Framework, AAOIFI Conceptual Framework, Resolution 2 of the Sharia Advisory Committee of Bank Negara Malaysia (SAC BNM), Statement of Islamic Financial Accounting Standards (PSAK Syariah), and other related references. The findings of this study indicate that AAOIFI and IFRS interpret the objectives of financial reporting differently. AAOIFI serves sharia principles as an intrinsic component of financial reporting, whereas IFRS implements neutrality of financial reporting from religion or standard components. Overall, the authors of this article maintain that Islamic banks conform to AAOIFI criteria for all of its components, including financial reporting objectives, key accounting assumptions, and SLM-based revenue estimation.

Investigating Financial Reporting Practices in Hybrid Financial Institusions in Indonesia

Hybrid financial institutions are sociopreneur organizations that carry out business activities with the aim of making profits and helping the community. Although these financial institutions make significant economic and social contributions to society, their financial reporting models still do not adequately present economic and non-economic information. This study aims to understand how financial reporting practices in financial institutions that have two functions or are often called hybrid financial institutions (profit motive and social motive) in Indonesia, especially in customary financial institutions Lumbung Pitih Nagari (LPN) in West Sumatra. The research design uses a case study at a hybrid financial institution of LPN. LPN is a customary financial institution whose main purpose of establishment is to help people who live in a village. In addition, this financial institution is also required to generate profit. The data collection technique is an in-depth interview with informants consisting of managers, communities, and other stakeholders. The results of this study show that LPN Limau Manis as a hybrid financial institution still uses financial reporting practices that are no different from conventional financial institutions in general. The types of financial statements produced following conventional financial institutions consist of income statements, statements of changes in equity, balance sheets, cash flow statements and notes to financial statements. While information about the social functions they perform is not reported in specific reports. It is only reported in a standard format in the form of social activity reports submitted at the General Meeting.

Accounting and the U.S. Constitution: The Evolution of Federal Financial Accounting and Reporting Practices

ABSTRACT This study surveys and provides insights into the arc of federal government financial reporting developments, including the reporting mandate contained in the Constitution of the United States. Federal financial reporting has recently surpassed several significant milestones. The U.S. Government Accountability Office and Office of Management and Budget celebrated the 100th anniversary of their founding in 2021. Meanwhile, the Chief Financial Officers Act of 1990 and the Federal Accounting Standards Advisory Board have reached the 30-year mark. Progress during the last 20 years has focused on extending the requirements of the Chief Financial Officers Act, improving federal financial reporting standards, and increasing transparency through easily accessible open data.

Determinants of Corporate Internet Financial Reporting in Asia-Pacific Countries: A Cross Country Analysis

The purpose of this study is to provide a comparative analysis of the quality of Corporate Internet Financial Reporting (CIFR) practices in the Asia Pacific. It examines the impact of firm size, listing age, internationalization, and auditor size on CIFR practices. The population in this study are all publicly listed companies in Australia, Singapore, and Indonesia. The sample comprises of non-financial companies in 2019, namely 95 Australian companies, 87 Singapore companies, and 85 Indonesian companies. Multivariate analysis is used to examine the hypothesis. The results show that Singapore and Indonesian firms have higher CIFR disclosure compared to Australia. This study found that some firm characteristics explain the level of CIFR disclosure. Firm size, internationalization, and auditor type have a significantly positive impact to CIFR disclosure in the Asia Pacific, while listing age does not explain the level of the CIFR.

The Impact of Financial Reporting Practices on Performance: A Study of Small and Medium Enterprises in Rathnapura District, Sri Lanka

The objective of the study is to examine the impact of financial reporting practices on the financial performance of small and medium enterprises (SMEs) in Rathnapura District, Sri Lanka. This empirical study is based on the primary data through face to face interviews and administered questionnaires and secondary data through examining subject related books, published research papers, websites, statistical reports of the Central Bank of Sri Lanka and other institutions, and their specific regulatory factsheets. Data were collected from the total selected sample of 60 SMEs Statistical tools; hypothesis testing, descriptive statistics, and Multiple Regression Analysis are used to analyze and find the result of the study. The designated measures of financial reporting practices are financial reporting practices, investment analysis practices, Inventory management practices, cash management practices, and fixed assets management practices. The findings revealed that among the five selected independent variables, there was a variation of 93% (Approx.) of the financial performance of SMEs due to changes in financial reporting practices, investment analysis practices, inventory analysis practices, cash management practices and fixed assets management practices that have been depicted in the model. Out of five variables, FR, IA, and FA management practices are highly supported to better financial performance than that of the INA and CM practices. This paper provides useful information to the Government Ministries, Central Bank of Sri Lanka, Professional Bodies SME owners, researchers, accounting practitioners and other stakeholders in Sri Lanka for their involvement in making efforts to the future development of SMEs.

Financial Reporting Practices and Sustainability of Micro Small and Medium Enterprises (MSMEs) in Akwa Ibom State

Financial Reporting Practices and Sustainability of Micro Small and Medium Enterprises (MSMEs) in Akwa Ibom State

Financial Reporting Practices and Internal Corporate Governance Mechanisms in Emerging Markets

Financial Reporting Practices and Internal Corporate Governance Mechanisms in Emerging Markets

Internet Financial Reporting Practices in Saudi Arabia

This paper examines the firm characteristic and corporate governance determinants of Internet Financial Reporting (IFR) practices in Saudi Arabia to help address the paucity of research for MENA region firms. The paper employs manual content and regression analyses of online annual report data for Saudi listed firms for the year 2018 using 28 IFR disclosure items. The results show that Saudi firm IFR has increased over time compared to previous studies to an average of 85% disclosure as a result of IFRS implementation and new corporate governance regulations. Firm size is a positive determinant of IFR disclosure, firm age and ownership concentration are negative drivers. Further, the extent of IFR disclosure varies by industry type, while profitability, liquidity, leverage, board size, board independence and role duality have no impact on IFR disclosure. Employing agency and signalling theories, the paper determines the influence of firm characteristics and corporate governance on IFR, identifying implications for stakeholders, and providing some evidence on the impact of IFRSs and corporate governance regulation on such disclosure. Further, the paper provides additional insight into progress towards Saudi’s Vision 2030.

Pengaruh Praktik Internet Financial Reporting (Ifr) Terhadap Nilai Pasar Perusahaan (Studi Empiris Pada Perusahaan Lq45 Yang Terdaftar Di Bursa Efek Indonesia)

Abstract : The problem in this research is the advancement of technology to make the company that makes official website in disclosing financial and nonfinancial information, Internet change the presentation of company information. This research aims to determine the influence of Internet Financial Reporting practices on the market value of LQ45 decisively company listed on the Indonesia Stock Exchange (IDX) period 2018. The population of this research is 50 LQ45 companies listed on the Indonesia Stock Exchange (IDX) period 2018. The sampling method used is purposive sampling, with a sample number of 32 companies. The data analysis technique in this study is a double linear regression analysis. An independent variable is internet financial reporting. The research uses control variables i.e. EPS, Bvps, company size, profitability, liquidity, and leverage. The dependent variables in this study are the company's market value. The results in this study of internet financial reporting practices influenced the company's market value. Two control variables i.e. company size and profitability are influential to the company's market value. While the variable control eps, bvps, liquidity and leverage have no significant effect on the company's market value. The conclusion in this study is that internet financial reporting practices have significant effect on the company's market value. Variable size control firms and profitability have significant effect on the company's market value. However for variable control EPS, Bvps, liquidity, and leverage have no significant effect on the company's market value.Keywords: Internet Financial Reporting, Company market value

Evaluation of Environmental Financial Reporting Practices among Nigeria Quoted Companies

Evaluation of Environmental Financial Reporting Practices among Nigeria Quoted Companies

True and Fair View of Financial Reporting Practices: Accountants’ Perspective

The purpose of this case article is to bridge the gap between theory and practice of financial reporting by analyzing the reporting practices from an accountant’s perspective. True and fair financial reporting is the basic requirement for achieving the objectives if Islamic financial system. Importantly, what causes the accountants to mismark the financial status of the companies has been spotlighted. It depicts the impact of aggressive revenue recognition, outright fraud, failing to accrue liability, misclassification of operating and non operating income and expenses, understatement and capitalization of expenses on financial statements. The management manipulates financial statements to have good impression about its performance and to shoe profitability, better return on assets, return on equity and debt ratios Study provides evidence for the mechanics used for manipulation and provides valuable input for the motives for aggressive reporting and outright fraud. It highlights the importance of accounting model to help and trace the manipulated financial statements for efficient investment decisions. The results of the study cannot be generalized to all countries because of difference in the adoption of international accounting standards, international financial reporting standards, generally accepted accounting principles and AAOFI standards in some cases.

Assessing Financial Reporting Practices of Small Retailers: A Malaysian Evidence

The growth of small retailers in Malaysia has increased substantially over the years. Such growth can contribute to a significant portion of the government’s income via tax revenue that can reduce if they do not practice financial reporting. This study examines the financial reporting practices of the small retailers in Malaysia. Specifically, this study examines whether the small retailers prepare financial statements, whether they keep accounting records and their motivation for doing so and the reasons for not keeping accounting records. Using a questionnaire survey on 150 small retailers, this study shows that the financial reporting practices among the small retailers are satisfactory. This study shows that the important motivations for them to practice financial reporting are performance evaluation and income distribution. In addition, time consuming and difficulty in maintaining system are the two main reasons for their failure in preparing financial reports. However, this study shows that sales generated by the small retailers are an important predictor to them practicing financial reporting. This study suggests the provision of financial reporting awareness and training programs to the small retailers so that they can appreciate the importance of financial reporting, and inculcate such practice in their business. The findings in this study can assist the interested parties particularly the Inland Revenue Board in understanding the challenges faced by the small retailers in practicing accountability to the government.

Financial Reporting Practices of Local NGO’s Operating in Bangladesh

Financial Reporting Practices of Local NGO’s Operating in Bangladesh

The Dark Side of Transparency in Developing Countries: The Link between Financial Reporting Practices and Corruption

This paper examines the impact of financial reporting practices in over 70,000 firms across 121 countries. While prior studies examining financial reporting practices mainly focus on the benefits of disclosure in developed markets such as the United States, we focus on the costs associated with increased financial transparency in emerging markets where governance mechanisms are relatively weak. We document a strong positive relation between the production of audited financial statements (AFS) and corruption obstacles faced by the firm. We argue that in corrupt business environment, rent-seeking bureaucrats use the available information to optimize their bribe extractions. We further show that country-level institutional quality has an important impact on the cost of transparency: the level of corruption obstacles associated with AFS is significantly higher in countries with weak corruption control mechanism. Our study sheds light on the dark side of transparency: exposure to corrupt bureaucrats where institutions are weak.

Financial Reporting Practices in the Insurance Company in Bangladesh: An Evaluation of the Implementation of IFRS 4, Insurance Contract

The wave of globalization has touched in every edge of the world and also proceeds in business world. Business uses accounting standard for preparing financial statements to examine the purpose of it. Financial globalization proceeds, International Financial Standard are increasingly becoming important instruments of integration. Meanwhile, International Financial Reporting Standards (IFRS) provides evidence of accounting quality for economic consequences. IFRS argues the purpose of financial reporting is essential to reduce information asymmetry between corporate manager of companies and parties contracting with firm. This has been observed in development countries whose are leading engine in the world. Different renowned economic forum and organization reinforced the influence of implementation of IFRS in which they called global accounting standards by 2011. By the end of 2008, there were over 100 countries that had adopted IFRS. Among IFRSs, IFRS 4 requires insurance contract to comply with international accounting standards for financial reporting in order to give improvements to accounting practice and to understand the salient aspects that are related to insurance company.

Financial Reporting Practices and Investment Decisions: A Review of the Literature

This study presents an effort to summarize evidence on literature about the effect of financial reporting practices on investment decisions. Regulatory interventions/changes impact financial reporting and thus play a significant role on the international comparability/usage of financial statements and as a result on investment decisions. We discuss existing literature regarding the effects of financial reporting practices firstly on the cost of equity capital. We then summarize literature concerning the effect of financial reporting practices on investment decisions as documented in the literature in the areas of earnings management; information asymmetry effects; accounting quality; the effects of the information environment; investment efficiency; over investment –under investment and cash flow sensitivity; stock market efficiency.

Financial Reporting Practices of Italian SMEs: Why Do They Disclose More?

From reporting periods ending on or after 31 December 2014, Italian unlisted companies filing their financial statements under the national GAAP have to deposit them to the Business Register in fully XBRL format. In particular, for companies submitting their financial statements in the abbreviated form, the mandatory taxonomy has offered the option to use in their notes also the tables of the standard one: this means that they can voluntarily provide more information than that normally required by the law. In this paper, we investigate this phenomenon focusing on its level and analyzing the variables explaining the reasons that push Italian SMEs to use, in their abbreviated financial statements, non-compulsory tables that are proper of the standard ones. Based on a large sample of 8,738 elements, we report surprising results: more than 80% of the abbreviated financial statements include at least one table proper of the standard ones, while on average they include seven. In addition, when analyzing the determinants of this phenomenon we find that the only relevant variable explaining the number of optional tables included in the abbreviated financial statements is the software used for preparing them.