Accounting report
Farzad Eivani; Hadis Abdi; Farshid Kheirollahi; nasrin moridi
Abstract
Integrated financial reporting provides crucial information about an organization's strategy, direction, performance, and future outlook encompassing business, social, and environmental performance within its operational context. It also promotes a coherent and effective approach to corporate reporting. ...
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Integrated financial reporting provides crucial information about an organization's strategy, direction, performance, and future outlook encompassing business, social, and environmental performance within its operational context. It also promotes a coherent and effective approach to corporate reporting. This research aims to compare the expectations of integrated financial reporting producers and users. Data analysis using SPSS software and statistical tests, including "Kolmogrove-smirnov", "Yoman-whitney" and "Friedman" has shown significant differences between the opinions of users and financial report preparers regarding report components, innovative practices, targeted investments, rewards and benefits, risk management, governance structure, and balanced scorecard. However, the comparison of expectations has shown no significant difference between the expectations of report providers and users regarding providing reports on mutual communication, compliance with legal and ethical standards, user’s engagement, and the reporting of financial status and sustainability of financial services.IntroductionAn integrated report should provide insight into the nature and quality of an organization's relationships with its key stakeholders. According to the International Integrated Reporting Council (IIRC), one of the guiding principles which underpin the preparation of integrated reports is the formation of effective stakeholder relationships. However, several challenges are also identified. These challenges include difficulties in determining what information is material and should, therefore, be included in an integrated report. This paper contributes to the ongoing debate on the quality and utility of integrated reporting by exploring the possibility that a perception gap has emerged, which affects the perceived relevance of integrated reporting. this paper makes an important contribution to the prior literature on integrated reporting by introducing the idea of a perception gap and offering one of the initial accounts of stakeholders’ perspectives on companies’ integrated reports. This will shed light on where companies can improve their integrated reports and inform the development of additional guidance by standard-setters and regulators.MethodologyThe study's statistical population comprises two groups: report producers and users. This includes auditors from the audit organizations and audit institutions, members of the Society of Official Accountants of Iran, as well as board directors and managers of companies listed on the Tehran Stock Exchange during the year 2022. The sampling method employed in this research is available sampling. This research is classified as a descriptive-survey study with an applied approach. The identified themes are incorporated into a Likert scale questionnaire. Lastly, the collected data were analyzed using SPSS software and relevant statistical tests.FindingsBased on the findings, there is a gap between auditors' and users' perspectives in terms of reporting and identifying innovative perspectives, targeted investments, rewards and benefits, risk management, governance structure, and balanced scorecard. Conversely, no significant gap is anticipated between the perspectives of producers and users in terms of mutual communication, compliance with legal and ethical standards, streamlining financial operations, user communication, as well as reporting financial status and corporate sustainability.Conclusion and discussionIn line with the examination of expectations between providers and stakeholders concerning the disclosure of integrated reporting components, the results of hypothesis testing indicate that, except for reporting and identifying innovative perspectives, targeted investments, rewards and benefits, risk management, governance structure, and balanced evaluation card, there is no significant expectation gap between beneficiaries and providers. In fact, the results indicate that users of integrated reports seek additional information on matters such as the competence and performance of those responsible for governance and how management has handled risk to ensure financial sustainability and prevent financial crises. They prioritize these aspects over the disclosure of information about social and environmental issues.Finally, the results of this study highlight several areas for future research. It would be valuable to investigate whether a perception gap exists in other industries and to identify the factors contributing to changes in the perception gap. More work also needs to be done to understand the determinants of the perception gap. This paper is based on the assumption that user sophistication affects the perceived importance of disclosures found in integrated reports. Cultural variables, the nature of the corporate governance system and the extent to which companies are able to manage perceptions are additional variables which need to be taken into account in order to define the dimensions of the perception gap in an integrated reporting context more accurately and inform policymakers and standard setters.
Accounting and various aspects of finance
farzad eivani; hadis abdi; farshid kheirollahi; mehri alimoradi
Abstract
The purpose of this study was to investigate the relationship between the audit expectation gap and investor confidence, also to investigate the role of the auditor’s improved level of communication on this relationship. To investigate this effect and a model with higher order constructs using ...
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The purpose of this study was to investigate the relationship between the audit expectation gap and investor confidence, also to investigate the role of the auditor’s improved level of communication on this relationship. To investigate this effect and a model with higher order constructs using a partial least-squares structural equation model (PLS-SEM), has been used. Based on a questionnaire survey with auditors and institutional investors, as one of the main users of audited financial statements, this study explored investors’ perceptions of both unreasonable and sensible audit expectation gaps (auditing performance and auditing standard gap) and the impact of auditor’s improved level of communication on this assessment. Based on the findings and values related to the path coefficients, audit quality and ensuring audit education have had a significant and positive effect on investor confidence. Also, a significant and negative relationship has been seen between the performance gap and the unreasonable audit gap with the level of investor confidence. Another finding of this study was the significant and positive effect of auditor’s improved level of communication on the relationship between the audit performance gap and the unreasonable audit gap with the level of investor confidence. Also, the calculation and analysis of fitness indicators using Smart-PLS software has confirmed the conformity of the conceptual framework and the experimental background with the results.
