Accounting report
Morteza Adlzadeh
Abstract
The complexities and continuous changes in the business environment have raised significant doubts about the ability of corporate reporting systems to meet stakeholders' needs. Additionally, the unique characteristics of Iran's economic environment necessitate careful consideration of the forces shaping ...
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The complexities and continuous changes in the business environment have raised significant doubts about the ability of corporate reporting systems to meet stakeholders' needs. Additionally, the unique characteristics of Iran's economic environment necessitate careful consideration of the forces shaping the future of corporate reporting and appropriate policymaking by stakeholders. This research evaluates the policy options using a mixed-method approach, employing scenario analysis for corporate reporting in Iran. In the first stage, semi-structured interviews with experts and a fuzzy Delphi survey were conducted to identify the drivers affecting the future of corporate reporting in Iran. Next, using the Schwartz model, the importance and uncertainty of the key drivers were determined. The findings revealed that the three most critical and uncertain drivers are "increasing the connection with the global economy," "privatization of property," and "credit-oriented financial system". In the final stage, corporate reporting issues were categorized into five groups, and ten action options were developed. Robust planning analysis indicated that the optimal policy option includes expanding the target audience, prioritizing public interests, recognizing intangible assets, moving toward international standards, and advancing non-financial reporting with updated requirements. The results of this research offer valuable applications and recommendations for policymakers and stakeholders in corporate reporting. IntroductionCorporate reporting plays an essential role in the effective functioning of the global economy and significantly contributes to shaping our understanding of the current and future drivers of value creation in business and the financial sector. It is constantly evolving to meet the demands of a diverse and expanding range of users, with ongoing efforts to adapt reporting procedures to the continuous changes in the regulatory and business environment. Policymakers and various stakeholders in corporate reporting must develop innovative approaches for forecasting and policymaking, considering future developments in the field. In this context, there is a growing demand for increased transparency and improved reporting mechanisms. Consequently, professional and academic authorities, standard-setting organizations, regulatory bodies, and other interested parties have begun conducting studies, proposing solutions, and establishing requirements to improve the corporate reporting system. Legislative institutions and standard-setting organizations have consistently aimed to provide standards and recommendations through an evolutionary process to enhance reporting and address the information needs of investors in resource allocation. Thus, The formulation of appropriate policies to accommodate changes in the corporate reporting system is critical. Corporate reporting requires well-informed decisions by policymakers to address these challenges. Based on this need, the main research questions of this study are as follows:What are the main scenarios for the possible future of corporate reporting in Iran's economic environment?According to different scenarios, what should be the appropriate policies for corporate reporting stakeholders?MethodologyThis study is applied research, employing a mixed methodology to achieve its objectives. Semi-structured interviews were conducted following the approach outlined by Kvale and Brinkman (2009) to identify the driving forces shaping the future of corporate reporting. Thematic analysis was used to analyze the interview data. For the qualitative analysis, appropriate methods aligned with Creswell (2008) approach were employed. In the second step, fuzzy Delphi analysis was conducted to reach a consensus on the identified drivers. Subsequently, to assess the level of importance and uncertainty, a questionnaire containing the list of consensus drivers was distributed to the experts who participated in the earlier stages of the research. The expert panel method was used to identify policy issues in corporate reporting, and corresponding action options were developed for each issue. The evaluation of these policy options was then carried out using a questionnaire tool based on expert opinions. The results from the questionnaire analysis were processed using MATLAB software, incorporating the development of a fuzzy inference system.ResultsDuring the exploratory interview phase with experts, 37 effective drivers of corporate reporting were identified. After two stages of fuzzy Delphi implementation, a total of 18 drivers were approved and agreed upon by the experts. These agreed-on drivers served as the foundation for developing scenarios based on the Schwartz model (1991). Among these, three drivers of "entering the global economic arena with the removal of sanctions," "privatization of ownership," and "changing the collateral-based financing system to a credit-based system" were identified as having both high importance and high uncertainty, making them the primary basis for developing distinct corporate reporting scenarios. Considering that three drivers are the basis for designing the scenarios. Given that each of these three drivers can exist in two possible states, a total of eight scenarios were designed. Five main corporate reporting challenges were identified to evaluate policy options, and ten action options were developed. Finally, based on the analysis of policy option evaluation using robust planning criteria, the best policy option was determined.ConclusionThe evaluation of different scenarios indicates that scenario number 1, characterized by increased linkage with the global economy, privatization of ownership, and credit-oriented financing, is a favorable scenario for corporate reporting. In this scenario, there is a more suitable platform, greater demand, and an improved environment for the development and advancement of corporate reporting. However, it is important to note that this scenario also raises expectations for corporate reporting. If these expectations are not adequately addressed, stakeholders may increasingly rely on alternative information mechanisms. Based on the analysis of policy options evaluated using robust planning criteria, the best policy option was identified. This option includes expanding the target audience group, prioritizing public interests, increasing recognition of intangible assets, adopting international standards, and advancing non-financial reporting types with new requirements. This policy option demonstrates appropriate and acceptable performance across different scenarios, making it the most suitable choice for corporate reporting.
Mahdi Moradzadeh Fard; Maryam Farajzadeh; Shima Karami
Abstract
The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting ...
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The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting from all companies listed in Tehran Stock Exchange using removal method over the time span of 2006-2010. Combined data method with fixed effect has been used in order to test the research hypothesis. The result depicts that the association between conservatism and investment is significantly negative when a firm do not need external financing. Nonetheless, this association is significantly positive in companies which need external financing. Furthermore, we find that the relationship between conservatism and investment in the companies whose ultimate ownerships controller is governmental or semi governmental firms is significantly negative. Thus, when the agency problem is enhancing, conservatism acts as a mechanism to decrease this problem and engenders reduction in investment cost.