The Impact of Corporate Governance on the Timeliness of Corporate Internet Reporting by Egyptian Listed Companies

Topics: Board of directors, Corporate governance, Corporation Pages: 31 (10145 words) Published: March 16, 2011
The current issue and full text archive of this journal is available at

MF 34,12


The impact of corporate governance on the timeliness of corporate internet reporting by Egyptian listed companies Amr Ezat and Ahmed El-Masry
Plymouth Business School, Plymouth, UK
Purpose – This study seeks to examine the key factors that affect the timeliness of corporate internet reporting (CIR) by the Egyptian listed corporations on the Cairo and Alexandria Stock Exchange. Design/methodology/approach – The authors use firm characteristics and corporate governance variables to investigate the influence on the timeliness of CIR. They also develop a disclosure index to measure the timeliness of CIR for the listed Egyptian corporations. Findings – The primary analysis finds a significant relationship between the timeliness of CIR and firm size, type of industry, liquidity, ownership structure, board composition and board size. The results indicate that firms typically in the service sector, that are large and have a high rate of liquidity, a high proportion of independent directors, a large number of board directors and a high free float disclose more timely information on their web sites. Furthermore, a significant association between the entire independent variables and some items of timeliness of CIR is found. Originality/value – This study is one of the first empirical studies to investigate the relationship between the corporate governance and the timeliness of CIR in an emerging market. Keywords Corporate governance, Egypt, Financial reporting, Stock exchanges, Online operations Paper type Research paper

Managerial Finance Vol. 34 No. 12, 2008 pp. 848-867 # Emerald Group Publishing Limited 0307-4358 DOI 10.1108/03074350810915815

1. Introduction Timeliness has long been recognised as one of the qualitative attributes of general purpose financial reports (American Institute of Certified Public Accountants (AICPA), 1973; Accounting Principles Board (APB), 1970; FASB, 1979). As the purpose of corporate reporting is providing information that will aid the users in decision making, timeliness become one of the most important characteristics of financial accounting information for the accounting profession (Soltani, 2002). Timeliness requires that information should be made available to financial statement users as rapidly as possible (Carslaw and Kaplan, 1991) and it is a necessary condition to be satisfied if financial statements are to be useful (Davies and Whittred, 1980, pp. 48-9). Empirical research on timeliness of financial reporting provides evidence that the degree of timeliness of information release has information content (Beaver, 1968) and affects firm value (Chambers and Penman, 1984; Givoly and Palmon, 1982; Kross and Schroeder, 1984). Many regulatory agencies and listing authorities around the world have issued requirements and recommendations regarding the timely disclosure of financial information (Abdelsalam and Street, 2007). Consequently, the usefulness of published corporate reports depends on their accuracy and their timeliness for the different stakeholders. This is confirmed by FASB in which defining the primary qualities that make accounting information useful, highlighted timeliness to be an important factor defined as: Having information available to decision makers before it loses its capacity to influence decisions is an ancillary aspect of relevance. If information is not available when it is needed

or becomes available so long after the reported events that it has no value for future action, it lacks relevance and is of little or no use (FASB, 2000).

Therefore, the usefulness of the information disclosed in company annual reports will decline as the time lag increases, and it has been argued by Abdulla (1996) that ‘‘the longer the period between year end and publication of the annual report, the higher the chances that the information will...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Corporate Governance in the Hershey Company Essay
  • Corporate Governance and Timeliness Essay
  • A Conceptual Framework for Investigating the Impact of the Internet on Corporate Financial Reporting Research Paper
  • Corporate Governance in an Electricity Company Essay
  • Corporate Governance RBS Essay
  • Essay about Effective corporate governance
  • Corporate Governance Assignment Essay
  • Hilton hotels Corporate Governance Essay

Become a StudyMode Member

Sign Up - It's Free
Скачать APK | WickedPictures After Forever XXX 720p MP4-KTR[N1C] | Pokemon XY: Ring no Chou Majin Fuupa Special