Concise corporate reporting: communication or symbolism?

Hrasky, Sue; Smith, Bernadette

doi:10.1108/13563280810914847

Cited by 39 publications

(61 citation statements)

References 31 publications

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“…One of the key characteristics of a good report is its ability to convey the necessary information to its wide audience in a way that is easy to read and understand and is appropriate for decision-making (Buitendag, Fortuin, & de Laan, 2017;Chatterjee, 2008;Cook & Sutton, 1995;Eugene Baker III & Kare, 1992;Jones, 1988;Pashalian & Crissy, 1952;Rahman, 2014;Richards & van Staden, 2015). Unfortunately, many studies have found that financial reports are lacking in readability (Anderson, 1998;Bartlett & Chandler, 1997;Hrasky & Smith, 2008;Schroeder & Gibson, 1992), in part as a result of increasing complexity (Eccles & Saltzman, necessarily read corporate reports nor find them useful, which could be a function of reports being difficult to read. Readability is positively associated with effective communication (Courtis & Hassan, 2002;Subramanian, Insley, & Blackwell, 1993) and was found to even affect the outcome of analysts" forecasts (Lehavy, Li, & Merkley, 2011).…”

Section: [Integrated R]eporting Provides Insight Into How a Company Vmentioning

confidence: 99%

The readability of integrated reports

Toit

2017

MEDAR

111

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Purpose -This is an exploratory study to investigate the readability of integrated reports. The aim is to assess whether integrated reports are accessible to their readership and add value to Research limitations/implications -The main limitation of the study lies in its exclusivelySouth African setting, which is the only country where integrated reports are recommended as part of stock exchange listings requirements. Another limitation is the fact that integrated reports are mainly aimed at informed users and is thus compiled with the informed reader in mind, which impacts on general readability. Practical implications -The results present new findings regarding integrated reportingpractice, which is of interest to firms, investors, regulators, amongst others. The findings show how the value-added by integrated reports could be improved.Originality/value -This study is the first to investigate the readability of integrated reports in a South African context. The results indicate that integrated reports are difficult to read and are only useful to a portion of the total intended population.

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Section: [Integrated R]eporting Provides Insight Into How a Company Vmentioning

confidence: 99%

The readability of integrated reports

Toit

2017

MEDAR

111

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“…and to use more graphs (e.g. Hrasky and Smith, 2008). Bank size was estimated as the natural logarithm of banks' total assets at the end of the financial year.…”

Section: Empirical Modelmentioning

confidence: 99%

Does graphical reporting improve risk disclosure? Evidence from European banks

Jones

Melis

Gaia

et al. 2018

JAAR

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If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.*Related content and download information correct at time of download. Does Graphical Reporting Improve Risk Disclosure? Evidence from European BanksPurpose: This study examines the voluntary disclosure of risk-related issues, with a focus on credit risk, in graphical reporting for listed banks in the major European economies. It aims to understand if banks portray credit risk-related information in graphs accurately and whether these graphs provide incremental, rather than replicative, information. It also investigates whether credit risk-related graphs provide a fair representation of risk performance or a more favourable impression than is warranted.Design/Methodology/Approach: A graphical accuracy index was constructed. Incremental information was measured. A multi-level linear model investigated whether credit risk affects the quantity and quality of graphical credit risk disclosure.Findings: Banks used credit risk graphs to provide incremental information. They were also selective, with riskier banks less likely to use risk graphs. Banks were accurate in their graphical reporting, particularly those with high levels of credit risk. These findings can be explained within an impression management perspective taking into account human cognitive biases. Preparers of risk graphs seem to prefer selective omission over obfuscation via inaccuracy. This probably reflects the fact that individuals, and by implication annual report's users, generally judge the provision of inaccurate information more harshly than the omission of unfavourable information. Research limitations/implications:This study provides theoretical insights by pointing out the limitations of a purely economics-based agency theory approach to impression management. Practical implications:The study suggests annual reports' readers need to be careful about subtle forms of impression management, such as those exploiting their cognitive bias. Regulatory and professional bodies should develop guidelines to ensure neutral and comparable graphical disclosure.Originality/Value: This study provides a substantive alternative to the predominant economic perspective on impression management in corporate reporting, by incorporating ...

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“…Hrasky and Smith (2008) assume corporate reporting is an important component of the investor relations function, and they look for evidence as to whether concise financial reports result in clearer communication between the company and its report users. In their study, characteristics of the chairperson's annual report letter and graph use in annual reports containing a concise financial report were compared to those in traditional full reports of listed Australian companies.…”

Section: Annual Reports and Disclosurementioning

confidence: 99%

“…In their study, characteristics of the chairperson's annual report letter and graph use in annual reports containing a concise financial report were compared to those in traditional full reports of listed Australian companies. According to their results, if concise reporters genuinely wish to improve the clarity of their communications, greater attention needs to be paid to how information is presented in their broader annual report (Hrasky & Smith, 2008 (Hutt, 2010). Lin et al (2012) collected the annual reports of the 660 public listed companies in Taiwan and applied content analysis to company annual reports to obtain the disclosure information for human capital.…”

Section: Annual Reports and Disclosurementioning

confidence: 99%

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System analysis of airport capacity and slot coordinatıon at Ataturk airport

Ateş¹

2016

Pressacademia

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The annual reports have been identified as one of the key corporate governance practice. If these reports are genuinely being prepared in an attempt to improve the clarity of communication with stakeholders, and give related and necessary information accurately to them, then they become one of the strategic tools affecting performance positively. Therefore, in this study, we aimed a semantic examination of the English versions of annual reports from companies quoted on Borsa Istanbul included in the Corporate Governance Index to see whether the annual reports' tone has an impact on company performance. With this aim, the contents of 2014 annual reports are analyzed by the text-analysis software package Diction 7 and scores for accomplishment, cooperation, activity and optimism are obtained. Efficiency scores are calculated by Data Envelopment Analysis to evaluate to what extent annual reports' tone and corporate governance ratings impact on company performance. The results show that the annual reports' tone and corporate governance ratings have a significant positive impact on efficiency scores, so on performances of companies.

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Concise corporate reporting: communication or symbolism?

Cited by 39 publications

References 31 publications

The readability of integrated reports

The readability of integrated reports

Does graphical reporting improve risk disclosure? Evidence from European banks

System analysis of airport capacity and slot coordinatıon at Ataturk airport

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