Al-Najjar, Basil and Abed, Suzan (2014) The association between disclosure of forward-looking information and corporate governance mechanisms: Evidence from the UK before the financial crisis period. Managerial Auditing Journal, 29 (7). pp. 578-595. ISSN 0268-6902
Metadata only available from this repository.Abstract
Purpose:
– This paper aims to witness the importance of corporate governance mechanisms and investigates the relationship between the quality of disclosure of forward-looking information in the narrative sections of annual reports and the governance mechanisms for non-financial UK companies.
Design/methodology/approach:
– Computerized content analysis using QSR NVivo 8 is used to measure the extent of forward-looking information in the narratives of the annual reports for 238 companies listed in the London Stock Exchange. Cross-sectional regression analysis is used to examine the impact of the corporate governance mechanisms on forward-looking information.
Findings:
– The results show that board size and the independence of the audit committee are associated with the level of voluntary disclosure of forward-looking information.
Research limitations/implication:
– One limitation of this study is that in controls for the effect of the financial crisis period, by selecting a representative year for a five-year period, 2006. The authors argument in using this year is based on the fact that the main variables of interest do not vary significantly with time, the cross-sectional analysis of the selected period will provide a fair view of the last five year-period.
Practical implications:
– The authors report the importance of some governance practices in the UK, such as the role of the board members as well as the importance of audit committee independence.
Originality/value:
– This paper contributes to the literature by using computerized content analysis to examine the relation between corporate governance mechanism and disclosure quality of forward-looking information using sample of companies before financial crisis period. The authors also examine governance mechanisms that are under-researched in the field of forward-looking disclosure.
Item Type: | Article |
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Uncontrolled Keywords: | Corporate governance, Board independence, Audit committee, Disclosure quality, Forward-looking information, Governance mechanism, M4 |
Subjects: | H Social Sciences > HG Finance |
Schools: | Huddersfield Business School |
Related URLs: | |
Depositing User: | Basil Al-Najjar |
Date Deposited: | 14 Aug 2017 08:48 |
Last Modified: | 28 Aug 2021 12:19 |
URI: | http://eprints.hud.ac.uk/id/eprint/32773 |
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