{"title":"Forward-looking disclosure tone in the chairman’s statement: obfuscation or truthful explanations","authors":"Hidaya Al Lawati, Khaled Hussainey, Roza Sagitova","doi":"10.1108/ijaim-03-2023-0060","DOIUrl":null,"url":null,"abstract":"Purpose This study aims to examine the impact of a firm’s financial performance on forward-looking disclosure (FLD) tone and assess whether managers are engaging in impression management or providing truthful explanations when their companies have good or poor performance. Design/methodology/approach This study used the content analysis method to measure the tone of FLD in the chairman’s statements of Omani financial institutions for the period 2014–2018. Regression analysis is then used to test the research hypotheses. Findings The authors found that good-performing firms are disclosing more good news, whereas poor-performing firms disclose more bad news. The results provided evidence that managers in Oman are providing truthful explanations in their narratives. Practical implications This study offered interesting policy and practical implications for policymakers, managers and stakeholders. This paper provided insights to policymakers regarding the FLD tone practices used in the chairman’s reports in Oman. Policymakers should be aware of the importance of the chairman’s reports in the eye of multiple stakeholders and, therefore, need to set guidelines on the type and quality of non-financial voluntary information that should be disclosed in such reports in the context of emerging economies. For academics, evidence has been provided by this study’s results regarding the impact of corporate performance on disclosure tone. Originality/value This study offered a novel contribution to disclosure studies by being the first to examine the performance-disclosure narrative tone relation, in the context of Oman.","PeriodicalId":46371,"journal":{"name":"International Journal of Accounting and Information Management","volume":null,"pages":null},"PeriodicalIF":4.3000,"publicationDate":"2023-11-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"International Journal of Accounting and Information Management","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1108/ijaim-03-2023-0060","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"MANAGEMENT","Score":null,"Total":0}
引用次数: 0
Abstract
Purpose This study aims to examine the impact of a firm’s financial performance on forward-looking disclosure (FLD) tone and assess whether managers are engaging in impression management or providing truthful explanations when their companies have good or poor performance. Design/methodology/approach This study used the content analysis method to measure the tone of FLD in the chairman’s statements of Omani financial institutions for the period 2014–2018. Regression analysis is then used to test the research hypotheses. Findings The authors found that good-performing firms are disclosing more good news, whereas poor-performing firms disclose more bad news. The results provided evidence that managers in Oman are providing truthful explanations in their narratives. Practical implications This study offered interesting policy and practical implications for policymakers, managers and stakeholders. This paper provided insights to policymakers regarding the FLD tone practices used in the chairman’s reports in Oman. Policymakers should be aware of the importance of the chairman’s reports in the eye of multiple stakeholders and, therefore, need to set guidelines on the type and quality of non-financial voluntary information that should be disclosed in such reports in the context of emerging economies. For academics, evidence has been provided by this study’s results regarding the impact of corporate performance on disclosure tone. Originality/value This study offered a novel contribution to disclosure studies by being the first to examine the performance-disclosure narrative tone relation, in the context of Oman.
期刊介绍:
The International Journal of Accounting & Information Management focuses on publishing research in accounting, finance, and information management. It specifically emphasizes the interaction between these research areas on an international scale and within both the private and public sectors. The aim of the journal is to bridge the knowledge gap between researchers and practitioners by covering various issues that arise in the field. These include information systems, accounting information management, innovation and technology in accounting, accounting standards and reporting, and capital market efficiency.