Company Characteristics, Dominant Personalities in Board Committees and Internet Financial Disclosures by Malaysian Listed Companies

Authors

  • Ali Saleh Alarussi Tunku Puteri Intan Safinaz School of Accountancy Universiti Utara Malaysia, Malaysia
  • Dhiaa Shamkhi Al-Zahra College for Women, Oman

DOI:

https://doi.org/10.32890/mmj2016.20.4

Keywords:

Internet reporting, dominant personalities, board committees, internationality

Abstract

This paper investigates whether the internet financial disclosure can be explained by a company’s characteristics and the dominant personalities in board committees of the Malaysian listed companies. Ten hypotheses were tested using data collected from 194 Malaysian listed companies’ websites. Specifically, this paper examines the relationship between the internet financial disclosures (IFD) and the variables, namely internationality, leverage, foreign shareholders, level of technology, firm age, number of shareholders, listing status, dominant personalities in the audit committee, and chairmen of audit and nomination committees. It is found that the level of technology, firm age, number of shareholders and listing status significantly affect the level of IFD. However, the dominant personalities in the audit and nomination committees affect negatively the level of IFD in Malaysia. The study provides some evidence to support the signaling theory and the cost and benefit hypothesis in relation to internet disclosure.

 

Downloads

Download data is not yet available.

References

Abdul Samad, F. (2002). Ownership structure in the Malaysian corporation sector: Its impact on corporate governance, performance, financing and investment patterns. Institute for Development Policy and Management Working Paper (University of Manchester).

Abdur Rouf & Abdullah-Al Harun. (2011). Ownership structure and voluntary disclosure annual reports of Bangladesh. Pak. J. Commer. Soc. Sci, 5(1), 129-139.

Ahmed, K., & Nicholls, D. (1994). The impact of non-financial company characteristics on mandatory disclosure compliance http://mmj.uum.edu.my

Bureau, D., & Raffournier, B. (1989). Some determinants of accounting choices for consolidated statements of French firms: The case of pension costs engagement. Paper presented at the 12th EAA congress, Stuttgart.

Camfferman, K., & Cooke.T. E. (2002). An analysis of disclosure in the annual reports of UK and Dutch companies. Journal of International Accounting Research, (1), 3-30.

Chen, C. J. P., & Jaggi, B. (2000). Association between independent non-executive directors, family control and financial disclosures in HongKong. Journal of Accounting and Public Policy, 19(4&5), 285-310.

Chow, C. W., & Boren, W. A. (1987). Voluntary financial disclosure by Mexican corporations. The Accounting Review, 62(3), 533-541.

Chtourou, S. M., Bedard, J., & Courteau, L. (2001). Corporate governance and earnings management. Social Science Research Network.

Clarkson, M. B. E. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. The Academy of Management Review, 20(1), 92-117. Cohen, J., Gaynor, L. M., Krishnamoorthy,

G., & Wright, A. M. (2007). Auditor communications with the audit committee and the board of directors: Policy recommendations and opportunities for future research. ACCOUNTING HORIZONS, 21(2), 165.

Collier, P. (1997). Corporate governance and audit committees. Current Issues in Auditing.

Cooke, T. E. (1989b). Voluntary corporate disclosure by Swedish companies. Journal of International Financial Management and Accounting, (1), 171195.

Cooke, T. E. (1992). The impact of size, stock market listing and industry type and disclosure in the annual report of japanese listed corporations. Accounting and Business Research, (87), 221-237.

Cormier. D., Ledoux MJ., & Magnan M. (2012). The moderating effect of voluntary disclosure on the relation between earnings quality and information asymmetry: Some Canadian evidence. International Journal of. Accounting, Auditing and Performance Evaluation, 8(2).

Da Silva, W. M., & de Lira Alves, L. (2004). The voluntary disclosure of financial information on the Internet and the firm value effect in companies across Latin America. 13th International Symposium on Ethics, Business and Society, January.

Dâmaso, G., & Lourenço, I. C. (2011). Internet financial reporting: Environmental impact companies and other determinants. 8th International Conference on Enterprise Systems, Accounting and Logistics (8th

ICESAL 2011)11-12 July 2011, Thassos Island, Greece Dolinšek, T., Tominc, P., & Skerbinjek, A. L. (2014). Users’ perceptions on Internet financial reporting. organizacija, 47,, 254-266.

Debreceny, R., Gray G. L., & Rahman, A. (2002). The determinants of Internet financial reporting. Journal of Accounting and Public Policy, 21, (4&5), 371-394.

Diamond, D., & Verrecchia, R. (1991). Disclosure, liquidity and the cost of equity capital. Journal of Finance, (44), 1325-1360.

Dichev, L., & Skinner, D. (2002). Large-sample evidence on the debt covenant hypothesis. Journal of Accounting Research, 40(4), 1091-1124.

Ettredge, M., Richardson, V. J., & Scholz, S. (2002). Dissemination of information for investors at corporate Websites. Journal of Accounting and Public Policy, 21(45), 357-369.

Frankel, R., Johnson, M., & Skinner, D. J. (1999). An empirical examination of conference calls as a voluntary disclosure medium. Journal of Accounting Research, 37(1), 133-150. Garcia-Benau, M. A., & Monterrey-Mayoral,

J. (1992). Voluntary financial disclosure by listed Spanish companies: Extent http://mmj.uum.edu.my emerging country: The case of Qatar; Advances in Accounting, incorporating Advances in International Accounting, 25. 255-265.

Hossain, M., Momin, M.A., & Leo, S. (2012). Internet financial reporting and disclosure by listed companies: Further evidence from an emerging country. Corporate Ownership and Control. 9(4), 350-366.

Hughes, P. J. (1986). Signalling by direct disclosure under asymmetric information. Journal of Accounting and Economics 8(2), 119-142.

Hurtt, D. N., Kreuze, J. G., & Langsam, S.A. (2001). Using the Internet for financial reporting. The Journal of Corporate Accounting & Finance, 12(3), 67-75.

Joshi. P.L, & Jawaher Al-Modhahki. (2003). Financial Reporting on the Internet: Empirical evidence from Bahrain and Kuwait. Asia Review of Accounting, (11), 88-101. Katsuhiko, K., Akihiro, N., Yasushi, O., &

Tomomi, S. (2001). Determinants of Environmental Report Publication in Japanese Companies. Paper presented at the the third APIRA conference, Adelaide Australia.

Khadaroo, M. I. (2005). Business reporting on the Internet in Malaysia and Singapore, A comparative study. Corporate Communications; an International Journal, 10(1), 58-68.

King, R., Pownall, G., & Waymire, G. (1990). Expectation adjustment via timely management forecasts: Review synthesis and suggestions for future research. Journal of Accounting Literature.

Kuruppu, N., Oyelere P., & Al Jabri, H., (2015) Internet Financial Reporting And Disclosure Practices Of Publicly Traded Corporations: Evidence From Sri Lanka., Accounting & Taxation. Vol (7), 75-91.

Lang, M. H., & Lundholm, R. J. (1996). Corporate disclosure policy and analyst behavior. The Accounting Review, 71(4), 467-492.

Laswad, F., Fisher, R., & Oyelere, P. (2005). Determinants of voluntary Internet and corporate characteristics. Paper presented at the the 15th EAA congress, Madrid.

Groff, J.E., & Pitman, M. K. (2004). Municipal financial reporting on the World Wide Web: A survey of financial data displayed on the official websites of the 100 largest U.S. municipalities. The Journal of Government Financial Management, 2(53), 2-22.

Gul, F. A., & Leung, S. (2004). Board leadership, outside directors’ expertise and voluntary corporate disclosures. Journal of Accounting and Policy, 23(5), 351-379.

Hamdan, A., Al-sartawi, Abd al Muttaleb M., & JaberRaed, J. (2013).The Effect of Corporate Governance on the Financial and Operational Performance and its Effect on Stock Performance in the Kuwait Stock Exchange. Arab Journal of Administrative Sciences. 20(2), 255.

Haniffa, R., & Cooke, T. (2002). Culture, corporate governance and disclosure in Malaysian Corporations. ABACUS, 38(3), 317-349.

Haron, H., Jantan, M., & Pheng, E. G. (2005). Audit committee compliance with Kuala Lumpur stock exchange listing requirements. International Journal of Auditing, 9(3), 187-200.

Hassan, A., Jaffer, N., & Johi, S. K. (1999). Financial Reporting on the Interent By Malaysian Companies: Perceptions and Practices. Asia-Pacific Journal of Accounting, 6(2), 299-319.

Ho, S. S. M., & Shun Wong, K. (2001). A study of the relationship between corporate governance structures and the extent of voluntary disclosure. Journal of International Accounting, Auditing and Taxation, 10(2), 139-156.

Hossain, M., Tan, L. M., & Adams, M. (1994). Voluntary disclosure in an emerging capital market: some empirical evidence from companies listed on the KualaLumpur Stock Exchange. The International Journal of Accounting, (4), 334-351.

Hossain, M., & Hammami, H. (2009). Voluntary disclosure in the annual reports of an http://mmj.uum.edu.my financial reporting by local government authorities. Journal of Accounting and Public Policy, 24(2), 101-121.

Leung., Morris, R. D., & Gray, S.J. (2005). Corporate transparency in china: factors influencing financial disclosure levels.

Levitt, A. (1999). Quality Information: The Lifeblood of Our Marketing. The Economic Club of New York.

Lodhia, S. K. (2004). Corporate environmental reporting media: A case for the world wide web. Electronic Green Journal(20).

Mangena, M., & Pike, R. (2004). Shareholding of audit committee members, audit committee size and expertise, and the quality of interim financial reporting: mimeo: Bradford.

Marston, C., & Polei, A. (2004). Corporate reporting on the Internet by German companies. International Journal of Accounting Information Systems, 5(3), 285–311.

Meek, G. K., Roberts, C. B., & Gray, S. J. (1995). Factors influencing voluntary annual report disclosures by US, UK and continental european multinational corporations. Journal of International Business Studies, 26(4).

Mitchell, W., Ho, Wern., & Pei, C. (2000). Corporate social disclosures by listed companies on their websites: An international comparison. HongKong, China: Hong Kong Polytechnic University.

Moonitz, M. (1961). The basic postulates of accounting. Accounting Research Study, AICPA.New York, 1.

Morris, R. D. (1987). Signalling, agency theory and accounting policy choice. Accounting and Business Research, 18(69), 47-56.

Naser, K., Al-Khatib, K., & Karbhari, Y. (2002). Empirical evidence on the depth of corporate information disclosure in developing countries: The Case of Jordan. International Journal of Commerce and Management, 12(3), 122-155.

Noor Azizi, Mahamad, T., & Adon, I. (2000). Financial reporting disclosure on the Internet by Malaysian - listed companies. Akauantan Nasional 1(1), 28-33.

Nekhili, M., Boubaker, S., & Lakhal, F. (2012). Ownership Structure, Voluntary R&D Disclosure and Market Value of Firms: The French Case. International journal of business, 17(2), 2012,ISSN: 10834346

Oyelere, P., Laswad, F., & Fisher, R. (2003). Determinants of internet financial reporting by New Zealand companies. Journal of International Financial Management and Accounting, 14(1), 2663.

Portes, R., & Rey, H. (2005). The determinants of cross-border equity flows. Journal of International Economics, 65(2), 269296.

Raffournier, B. (1995). The determinants of voluntary financial disclosure by Swiss listed companies. The European Accounting Review, 4(2), 261-280.

Richardson, A. J., & Welker, M. (2001). Social disclosure, financial disclosure and the cost of equity capital. Accounting Organizations and Society, 26(7), 597616.

Roberts. (1992). Determinants of corporate social responsibility disclosure: An application of stakeholder theory. Accounting, Organizations and Society, 17(6), 595-612. Rosli Mohammed, Amdan Mohamed, &

Mohamed, M. (2003). Internet financial reporting (IFR) in Malaysia;- A survey of contents and presentations University Utara Malaysia.

Sanad, Z. R., & Al-Sartawi, A. M., (2016) Investigating the Relationship between corporate governance and Internet financial reporting (IFR): Evidence from Bahrain Bourse. Jordan Journal of Business Administration, 12(1).

Shivdasani, A., & Yermack, D. (1999). CEO involvement in the selection of new board members: An empirical analysis. The Journal of Finance, 54(5), 18291853.

Singh, H., & Singh, A. (2015). Internet Financial Reporting by Indian Public and Private Companies. Journal of Marketing and HR, (1), 25-32.

Skinner, D. J. (1994). Why firms voluntary http://mmj.uum.edu.my reporting and communication. Business Strategy and the Environment, (10), 1-14.

Wong, N. L. (1996). Easing down the meritdisclosure continuum: A case study of Malaysia and Taiwan. Law and Policy in International Business, 28(1).

Xiao, J. Z., Yang, H., & Chow, C. W. (2004). The determinants and characteristics of voluntary Internet-based disclosures by listed Chinese companies. Journal of Accounting and Public Policy, 23(3), 191-225.

Yatim, P., Kent, P., & Clarkson, P. (2006). Governance structures, ethnicity, and audit fees of Malaysian - listed firms. Managerial Auditing Journal, 21(7), 757-782.

Yeo, G. H. H., & Ziebart, D. A. (1995). An empirical test of the signaling effect of management’s_earnings forecasts: A decomposition of the earnings surprise and forecast surprise effects. Journal of Accounting, Auditing & Finance, 10(4), 787-802. disclose bad news. Journal of Accounting Research, (32), 38-60.

Susanto, D. (1992). An empirical investigation of the extent of corporate disclosure in annual reports of companies listed on the Jakarta stock exchange University Microfilms International.

Tariq, H. I. (2001). An empirical investigation of factors influencing voluntary disclosure of financial information on the Internet in the GCC countries. Qatar University.

Vafeas, N. (1999). The nature of board nominating committees and their role in corporate governance. Journal of Business Finance & Accounting, 26(12), 199-225.

Verawaty. (2016). The comparative analysis of accessibility index value of government Internet financial reporting In Indonesia. Applied Finance and Accounting, 2(2).

Watts, R. L., & Zimmerman, J. L. (1986). Positive accounting theory. Englewood Cliffs, New Jersey.

Wheeler, D., & Elkington, J. (2001). The end of the corporate environmental report? Or the advent of cybernetic sustainability http://mmj.uum.edu.my

Downloads

Published

01-12-2016

Issue

Vol. 20 (2016): Malaysian Management Journal (MMJ) Vol. 20, December 2016

Section

Articles

How to Cite

Alarussi, A. S., & Shamkhi, D. (2016). Company Characteristics, Dominant Personalities in Board Committees and Internet Financial Disclosures by Malaysian Listed Companies. Malaysian Management Journal, 20, 59-75. https://doi.org/10.32890/mmj2016.20.4

Research impact

Harvested 2026-09-06
0 citations recorded so far

Counts differ between services because each indexes a different body of literature. None of them is the whole picture.

Identifiers DOI 10.32890/mmj2016.20.4

Most read articles by the same author(s)