The Nature of the Interaction between Mandatory and Voluntary Disclosures

Einhorn, Eti

doi:10.1111/j.1475-679x.2005.00183.x

Cited by 171 publications

(118 citation statements)

References 30 publications

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“…5;2013 3 to replace missing information with voluntary one. When regulators mandate voluntary information there is no need for company to create discretionary disclosure strategies (Einhorn, 2005).…”

Section: Mandatory Disclosure Voluntary Disclosure and Their Associamentioning

confidence: 99%

Mandatory Disclosure and Its Impact on the Company Value

Popova¹,

Γεωργακόπουλος²,

Sotiropoulos³

et al. 2013

IBR

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This study investigated the association between mandatory disclosure and company value expressed in share price anticipation of earnings by using a sample of UK companies included in the FTSE 350 Index for a period of five years, from 2006 to 2010. A mandatory disclosure index was developed according to the IFRSs, which the companies listed in the stock market were obliged to adopt since 2005, and was utilized for the quantification of the extent of mandatory disclosure. The relationship between mandatory disclosure and some specific company characteristics was also investigated. The analysis revealed a high level of disclosure by UK companies indicating that managers do not treat mandatory disclosure as a routine obligation, but they strive to be strictly compliant with all reporting requirements imposed by the regulatory authorities. Moreover, the extent of disclosure was significantly correlated with company value, leverage and age, which justifies that market mechanism is also essential in disclosure practice. However, the correlation between mandatory disclosure and listing status, earnings and size is not statistically significant.

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Section: Mandatory Disclosure Voluntary Disclosure and Their Associamentioning

confidence: 99%

Mandatory Disclosure and Its Impact on the Company Value

Popova¹,

Γεωργακόπουλος²,

Sotiropoulos³

et al. 2013

IBR

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“…Al-Razeen & Karbhari, 2004;Dye, 1985Dye, , 1986Einhorn, 2005;Naser & Nuseibeh,increase of mandatory disclosure requirements. Furthermore, these studies do not provide a sufficient theoretical background for financial reporting research, which has resulted in a lacuna in the guidance of academic researchers.…”

Section: Introductionmentioning

confidence: 99%

Codification Theory is a Gateway for Setting Mandatory Reporting Requirements in Emerging Economies

Al‐Htaybat¹

2014

IJEF

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This study provides an explanation of how the process of setting new mandatory disclosure requirements in the financial reporting environment takes place by using codification theory. An empirical investigation was undertaken on the Jordanian financial reporting practices by measuring the association between the voluntary and mandatory disclosure practices of 51 manufacturing corporations before and after imposing the new Jordanian Securities Commission (JSC) mandatory requirements in 1998. The results indicate a significant, positive relationship that reflects that in 1998 the JSC took the existing Jordanian companies' voluntary financial disclosure practices and codified this practice into mandatory disclosure requirements. This paper provides evidence that will benefit future accounting standard setters as the codification of an existing optimal voluntary practice as a mandatory requirement increases the future level of compliance. This might be due to familiarity and cost effectiveness through reduced costs of compliance and analysis from a corporation's side, as well as through reduced costs associated with setting financial reporting standards, as the process can be costly for government. This paper addresses a topic that has not received appropriate attention in the extant literature, which offers a new platform for future research exploring new developments of financial reporting in relation to codification theory.

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“…Dye, 1985;Dye, 1986;Naser & Nuseibeh, 2003;Al-Razeen & Karbhari, 2004;Einhorn, 2005;Broberg et al, 2010;Robertson et al, 2012). However, "there is no clear association between these two concepts" (Popova et al, 2013).…”

Section: The Association and Interaction Between MD And Vdmentioning

confidence: 99%

The Changes of Disclosure in Compliance with the New Regulations in Jordan

Omar¹

2015

IBR

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The study investigates the differences in the disclosure practices (mandatory and voluntary) for 60 Jordanian companies listed in Amman Stock Exchange (ASE), before the regulations (1996) and after (2003). The evaluation is conducted using the mandatory and voluntary indices. Furthermore, the relationship between mandatory and voluntary disclosure will be tested in order to determine the effect of mandatory disclosure on the level of voluntary disclosure. The study adopted a sequential explanatory triangulation design which incorporated both quantitative and qualitative data collection and analysis. Various statistical techniques (e.g. paired sample t-test and Wilcoxon signed rank test) were employed using a matched pairs sample (60 companies) in 1996 and 2003.The results indicate that there was a significant increase in the level of mandatory disclosure for Jordanian companies in 2003 compared with 1996. However, the level of voluntary disclosure did not differ significantly for Jordanian companies in the periods, 1996 and 2003. In addition, the findings revealed a significant positive association between mandatory and voluntary disclosure for Jordanian companies. Thus, it could be concluded that the new regulations affect positively the level of voluntary disclosure.Finally, the interview results suggested that extensive regulation may improve the level of disclosure, with the provision that too many regulations could be a burden or source of confusion for companies.

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The Nature of the Interaction between Mandatory and Voluntary Disclosures

Cited by 171 publications

References 30 publications

Mandatory Disclosure and Its Impact on the Company Value

Mandatory Disclosure and Its Impact on the Company Value

Codification Theory is a Gateway for Setting Mandatory Reporting Requirements in Emerging Economies

The Changes of Disclosure in Compliance with the New Regulations in Jordan

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