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The Expectation Gap in Internet Financial Reporting: Evidence from an Emerging Capital Market

Asli Turel

MPRA Paper from University Library of Munich, Germany

Abstract: The development of the internet as a global medium has significantly impacted financial reporting environment of the companies. Recently, companies have started reporting their financial results and other information relating to business on their web pages. The internet offers the facility to provide all interested groups with information to make well-informed, timely investment decision thus reducing the information advantages of institutional investors and information intermediaries. This study examines the level of internet financial reporting in Turkey. Furthermore, it tries to find out whether there is an expectation gap in internet financial reporting. In this study, “expectation gap” refers to the difference between (1) what financial statement users perceive important in decision making process to be and (2) what companies actually disclose or present in their web pages. Our findings indicate that an expectation gap exists; financial statement users have higher expectations for various facets than what companies actually report in the areas such as; reports of analysts, phone number to investor relations, segmental reporting, financial data in processable format, and summary of financial data. Our findings serve as evidence that the companies should engage in appropriate actions to reduce this expectation gap.

Keywords: Internet; Financial Reporting; Turkey (search for similar items in EconPapers)
JEL-codes: M41 M4 (search for similar items in EconPapers)
Date: 2010
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Published in Middle Eastern Finance and Economics 8 (2010): pp. 94-107

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