DISCLOSURE IN JAPANESE CORPORATE ANNUAL REPORTS

This paper reports the results of a survey of disclosure in the annual reports of unlisted and listed corporations in Japan, a country that many argue has a unique environment. The paper attempts to investigate differences between companies in the extent of disclosure in their Commercial Code (CC) and Securities and Exchange Law (SEL) accounts respectively. The survey finds that there is a significant difference in disclosure by multiple listed companies in their CC accounts compared with domestically listed corporations and unlisted enterprises. It is also found that there is a significant difference in disclosure between multiple listed and domestically listed entities in their SEL accounts. However, there was no significant difference in disclosure between the TSE (Tokyo Stock Exchange) group and the unlisted group in their CC accounts.     

PRIVATE SHAREHOLDER RESPONSE TO CORPORATE ANNUAL REPORTS*

Private shareholder response to annual reports of Australian public-listed companies was investigated via postal questionnaires in 1979 and 1980. Approximately 2000 usable replies indicate that although annual reports are ranked third to stockbroker advice and newspapers as sources of corporate information, two-thirds claim the report is of some importance and one-quarter would buy it and pay up to $2 per copy. Readership behaviour reveals that whereas the chairman's review is the most read item, traditional financial statements are more important in influencing equity decision-making. The auditor's report, statistical data and notes to accounts are least read and least important. Such evidence has implications for report preparers, auditors, accountancy professional bodies, financial journalists and educators.     

ASSET REVALUATION AND CURRENT COST ACCOUNTING: UK CORPORATE DISCLOSURE DECISIONS IN 1983

Accountants have long disputed whether financial statements should report current values and the effects of price changes. Indeed, the two kinds of adjustment are often confused. This study examines the asset revaluation and Current Cost Accounting (CCA) disclosure decisions of UK firms in 1983, using a costly contracting framework. We find the two decisions appear to have been taken for very different reasons and to be largely unrelated, even though the resultant measures overlapped to a non-trivial degree. The two common factors were that revaluers and CCA disclosers both tended to be large and to have revalued in the previous two years. Indebtedness was positively related to revaluation and negatively to CCA disclosure. Current Cost Accounting disclosure was also positively correlated with profitability and fixed asset intensity, whereas revaluation was not.     

SILENCES IN ANNUAL REPORTS

In this paper, we show how annual reports rely upon the silencing of injustices in order to make profit appear to be an unproblematic measure of success. In particular, we examine the ways in which corporations silence the negative impact of their activities upon the earth, the hell of war and the beauty of peace, the spiritual, human and social impoverishment arising from excessive consumption, and the dehumanization of workers. Only by breaking silence and counter-posing corporate values with alternatives can we hope to free humankind from the limitations of profit maximization and promote a world in which peace, happiness, respect for diversity, etc. take precedence to capital accumulation.     

FINANCIAL ACCOUNTING REPORTS: A MARKET MODEL OF DISCLOSURE: A REPLY

Walker in his Comment appears to disagree with the explicandum and attempts to prove this with alternative explicans. It is a case of post hoc, ergo propter hoc. The development of a normative model or theory requires the choice of a number of assumptions. These observations or statements are themselves theory laden. Nevertheless deductions drawn from the model are either correct or incorrect according to the laws of logic.     

FINANCIAL ACCOUNTING REPORTS: A MARKET MODEL OF DISCLOSURE: A COMMENT

In a recent paper Bird and Locke concluded "that a freely operating market for accounting information, unencumbered with disclosure requirements, can work efficiently". The purpose of this Comment is to explain why this conclusion is unjustified. In particular it argues that our present understanding of the socalled 'Market' for information is so limited that no presumption, either for or against the efficiency of this market, can be given unequivocal theoretical support.     

A CONCEPTUAL FRAMEWORK FOR CORPORATE RISK DISCLOSURE EMERGING FROM THE AGENDA FOR CORPORATE GOVERNANCE REFORM

During the last decade an implicit conceptual framework for internal control and corporate risk management has arisen from risk management practice and policy within UK companies. An explicit conceptual framework for risk management is now emerging and is expressed in the Turnbull Report. In this paper, we develop a diagrammatic representation for the conceptual framework for internal control, risk management and risk disclosure. We consider the recent practical and policy developments in the disclosure of risk-related information in order to establish the current state of the art of corporate risk disclosure. Thus, we focus only on the disclosure aspect of the conceptual framework for internal control. We use a questionnaire survey to canvas the attitudes of UK institutional investors towards risk disclosure in relation to their portfolio investment decisions. Our empirical findings indicate that institutional investors do not generally favour a regulated environment for corporate risk disclosure or a general statement of business risk. The respondents agree that increased risk disclosure would help them in their portfolio investment decisions. However, for other aspects of the risk disclosure issue they are more neutral in attitude. Further, we found that the variation in the attitudes of institutional investors appears to be associated with the characteristics of the funds they manage as well as with their investment horizons. Further, we find that institutional investors’ perceptions of corporate governance are related to their investment horizons, among other factors.     

THE ASSOCIATION BETWEEN LEASE DISCLOSURE AND THE LESSEE'S SYSTEMATIC RISK

This paper investigates the effect of a firm's lease commitment disclosure under Accounting Series Release 147 on its systematic risk. The three hypotheses are: (1) there will be no change in the lessee's systematic risk; (2) the lessee's systematic risk will increase because the disclosure increases the debt ratio; and (3) the lessee's systematic risk decreases because the disclosure reduces the uncertainty related to risk-assessment. A hedge portfolio approach is used to test these hypotheses. The results indicate that the null hypothesis is to be rejected in favor of the third hypothesis.