THE USEFULNESS OF CORPORATE FINANCIAL REPORTS: EVIDENCE FROM THE UNITED ARAB EMIRATES

Abdulkareem Alzarouni, Khaled Aljifri, Chew Ng and Mohammad Iqbal Tahir

Accounting & Taxation, 2011, vol. 3, issue 2, 17-37

Abstract: The purpose of this paper is to examine the usefulness of financial reports to users in the United Arab Emirates (UAE). It is an attempt to find out whether current practices satisfy users’ needs of information and the extent to which these needs have been satisfied by the current disclosure practices of UAE companies. A survey questionnaire was used to explore whether the financial reports published by UAE firms were relevant to the needs of their users and to identify the disclosure items they perceived as important. Of the 512 questionnaires distributed to major external users of financial reports, 404 were returned. The results indicate that users in the UAE consider corporate annual reports to be the most important source of information. However, the level of corporate financial disclosure in the UAE does not provide sufficient information to the users. In fact, it meets only 61% of the needs reported by external users of financial reports. The users also nominated several areas of concerns, including delays in the availability of annual reports, the lack of creditability of financial information, and the non-accessibility of financial reports.

Keywords: Corporate financial disclosure; information needs; user groups; usefulness; UAE firms; annual reports (search for similar items in EconPapers)
JEL-codes: M4 M41 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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