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The Arab Perceptions on the Influence of Western Developed Practices on Financial Disclosure Practices- Jordan Evidence

Year 2013, Volume: 6 Issue: 2, 0 - 0, 01.06.2013

Abstract

Özet: This study aims to investigate the views of different groups involved in enforcing, teaching, and adopting IFRS in Jordan concerning the different factors influencing de facto compliance with IFRS and whether the introduction of the OECD corporate governance principles improved such compliance. This was achieved by carrying out face-to-face interviews. It was also believed that face-to-face interviews would enable the researcher to estimate the degree of awareness among national investors regarding the level of disclosures that must be provided by companies listed on the stock exchanges of their jurisdiction, and the concept of corporate governance. The outcome of the conducted interviews revealed that the major barriers to full compliance with IFRS disclosure requirements in the Amman Stock Exchange (ASE) are: low non-compliance costs, inadequate qualification of accounting practitioners, low demand for more disclosure by investors, management resistance, and the lack of relevance of all the requirements under IFRS to the economic development stage of the scrutinised capital market. The impact of the introduction of corporate governance codes in the scrutinised context on improving de facto compliance with IFRS is not clear. Additionally, the results enhanced the assessment of the applicability of the Western theoretical foundations to the Arab emerging capital markets.

References

  • Abdelsalam, O.H., and Street, D.L. 2007. Corporate Governance and the Timeliness of Corporate Internet Reporting by UK Listed Companies. Journal of International Accounting, Auditing and Taxation, 16, 111–130.
  • Al-Akra, M., Ali, M. and Marashdeh, O. 2009. Development of Accounting Regulation in Jordan. The International Journal of Accounting, 44, 163–186.
  • Al-Akra, M., Eddie, I., and Ali, M.J. 2010a. The Influence of the Introduction of Accounting Disclosure Regulation on Mandatory Disclosure Compliance: Evidence from Jordan. The British Accounting Review, 42(3), 170–186.
  • Al-Akra, M., Eddie, I., and Ali, M.J. 2010b. The Association between Privatisation and Voluntary Disclosure: Evidence from Jordan. Accounting and Business Research, 40(1), 55–74.
  • Al-Omari, A. 2010. The Institutional Framework of Financial Reporting in Jordan. European Journal of Economics, Finance and Administrative Sciences, 22, 32-50. Alanezi, F., and Albuloushi, S. 2011. Does The Existence of Voluntary Audit Committees Really Affect IFRS Required Disclosure? The Kuwaiti Evidence. International Journal of Disclosure and Governance, 8(2), 148–173.
  • Archambault, J.J., and Archambault, M.E. (2003). A Multinational Test of Determinants of Corporate Disclosure'. The International Journal of Accounting. Vol.38(2). pp. 173–194.
  • Cadbury Committee Report. 1992. Report of the Cadbury Committee on the Financial Aspects of Corporate Governance. Tech. rept. Cadbury Committee, Gee. London.
  • CIPE. (2003). 'Corporate Governance in Morroco, Egypt, Lebanon and Jordan- Countries of the MENA Region'. Middle East and North Africa Corporate Governance Workshop. The Center for International Private Enterprise.
  • Creswell, J. W. (2003).Research Design: Qualitative, Quantitative, and Mixed Methods Approaches. Thousand Oaks: Sage.
  • Collis, J. and Hussey R. (2003).Business Research: A Practical Guide for Undergraduate and Postgraduate Students. (2 nd Edition). Basingstoke: Palgrave Macmillan. Ghazali, N.A.M., and Weetman, P. 2006. Perpetuating Traditional Influences: Voluntary Disclosure in Malaysia Following the Economic Crisis. Journal of International Accounting, Auditing and Taxation, 15, 226–248.
  • Gul, F.A., and Leung, S. 2004. Board Leadership, Outside Directors Expertise and Voluntary Corporate Disclosures. Journal of Accounting and Public Policy, 23, 351–379.
  • Haniffa, R.M., and Cooke, T.E. 2002. Culture, Corporate Governance and Disclosure in Malaysian Corporations. Abacus, 38(3), 317–349.
  • IFC and Hawkamah (2008). 'A Corporate Governance Survey of Listed Companies and Banks Across the Middle East and North Africa'.
  • Available: http://www.ifc.org/ifcext/mena.nsf/AttachmentsByTitle/CG+Survey+of+Listed+Companies+and+Banks+across+ME
  • NA/$FILE/MENA+Corporate+Governance+Survey.pdf. Accessed 25/2/2010.
  • Mir, M.Z., Chatterje, B. and Rahman, A.S. (2009).'Culture and Corporate Voluntary Reporting'. Mangerial Auditing Journal. Vol. 24 (7). pp. 639-667.
  • Nobes, C. (2006). 'The Survival of International Differences under IFRSs: Towards a Research Agenda'. Accounting and Business Research. Vol. 36(3). pp. 233–245. OECD. 2004. Organization for Economic Cooperation and Development. Paris: OECD Principles of Corporate Governance, OECD Publications.
  • Punch, K. F. (1998).Introduction to Social Research - Quantitative & Qualitative Approaches. London: Sage Publications.
  • Qu, Wen, and Leung, Philomena. (2006). 'Cultural Impact on Chineese Corporate Disclosure- a Corporate Governance Perspective'. Mangerial Auditing Journal. Vol. 21(3). pp. 241–264.
  • ROSC. (2005). Report on the Observance of Standards and Codes (ROSC). Corporate Governance Country Assessment: Hashemite Kingdom of Jordan. World Bank. Feb.
  • Shanikat, M. and Abbadi, S. 2011. Assessment of Corporate Governance in Jordan: An Empirical Study, Australasian Accounting Business and Finance Journal, 5(3), 93-106.
Year 2013, Volume: 6 Issue: 2, 0 - 0, 01.06.2013

Abstract

Özet: This study aims to investigate the views of different groups involved in enforcing, teaching, and adopting IFRS in Jordan concerning the different factors influencing de facto compliance with IFRS and whether the introduction of the OECD corporate governance principles improved such compliance. This was achieved by carrying out face-to-face interviews. It was also believed that face-to-face interviews would enable the researcher to estimate the degree of awareness among national investors regarding the level of disclosures that must be provided by companies listed on the stock exchanges of their jurisdiction, and the concept of corporate governance. The outcome of the conducted interviews revealed that the major barriers to full compliance with IFRS disclosure requirements in the Amman Stock Exchange (ASE) are: low non-compliance costs, inadequate qualification of accounting practitioners, low demand for more disclosure by investors, management resistance, and the lack of relevance of all the requirements under IFRS to the economic development stage of the scrutinised capital market. The impact of the introduction of corporate governance codes in the scrutinised context on improving de facto compliance with IFRS is not clear. Additionally, the results enhanced the assessment of the applicability of the Western theoretical foundations to the Arab emerging capital markets.

References

  • Abdelsalam, O.H., and Street, D.L. 2007. Corporate Governance and the Timeliness of Corporate Internet Reporting by UK Listed Companies. Journal of International Accounting, Auditing and Taxation, 16, 111–130.
  • Al-Akra, M., Ali, M. and Marashdeh, O. 2009. Development of Accounting Regulation in Jordan. The International Journal of Accounting, 44, 163–186.
  • Al-Akra, M., Eddie, I., and Ali, M.J. 2010a. The Influence of the Introduction of Accounting Disclosure Regulation on Mandatory Disclosure Compliance: Evidence from Jordan. The British Accounting Review, 42(3), 170–186.
  • Al-Akra, M., Eddie, I., and Ali, M.J. 2010b. The Association between Privatisation and Voluntary Disclosure: Evidence from Jordan. Accounting and Business Research, 40(1), 55–74.
  • Al-Omari, A. 2010. The Institutional Framework of Financial Reporting in Jordan. European Journal of Economics, Finance and Administrative Sciences, 22, 32-50. Alanezi, F., and Albuloushi, S. 2011. Does The Existence of Voluntary Audit Committees Really Affect IFRS Required Disclosure? The Kuwaiti Evidence. International Journal of Disclosure and Governance, 8(2), 148–173.
  • Archambault, J.J., and Archambault, M.E. (2003). A Multinational Test of Determinants of Corporate Disclosure'. The International Journal of Accounting. Vol.38(2). pp. 173–194.
  • Cadbury Committee Report. 1992. Report of the Cadbury Committee on the Financial Aspects of Corporate Governance. Tech. rept. Cadbury Committee, Gee. London.
  • CIPE. (2003). 'Corporate Governance in Morroco, Egypt, Lebanon and Jordan- Countries of the MENA Region'. Middle East and North Africa Corporate Governance Workshop. The Center for International Private Enterprise.
  • Creswell, J. W. (2003).Research Design: Qualitative, Quantitative, and Mixed Methods Approaches. Thousand Oaks: Sage.
  • Collis, J. and Hussey R. (2003).Business Research: A Practical Guide for Undergraduate and Postgraduate Students. (2 nd Edition). Basingstoke: Palgrave Macmillan. Ghazali, N.A.M., and Weetman, P. 2006. Perpetuating Traditional Influences: Voluntary Disclosure in Malaysia Following the Economic Crisis. Journal of International Accounting, Auditing and Taxation, 15, 226–248.
  • Gul, F.A., and Leung, S. 2004. Board Leadership, Outside Directors Expertise and Voluntary Corporate Disclosures. Journal of Accounting and Public Policy, 23, 351–379.
  • Haniffa, R.M., and Cooke, T.E. 2002. Culture, Corporate Governance and Disclosure in Malaysian Corporations. Abacus, 38(3), 317–349.
  • IFC and Hawkamah (2008). 'A Corporate Governance Survey of Listed Companies and Banks Across the Middle East and North Africa'.
  • Available: http://www.ifc.org/ifcext/mena.nsf/AttachmentsByTitle/CG+Survey+of+Listed+Companies+and+Banks+across+ME
  • NA/$FILE/MENA+Corporate+Governance+Survey.pdf. Accessed 25/2/2010.
  • Mir, M.Z., Chatterje, B. and Rahman, A.S. (2009).'Culture and Corporate Voluntary Reporting'. Mangerial Auditing Journal. Vol. 24 (7). pp. 639-667.
  • Nobes, C. (2006). 'The Survival of International Differences under IFRSs: Towards a Research Agenda'. Accounting and Business Research. Vol. 36(3). pp. 233–245. OECD. 2004. Organization for Economic Cooperation and Development. Paris: OECD Principles of Corporate Governance, OECD Publications.
  • Punch, K. F. (1998).Introduction to Social Research - Quantitative & Qualitative Approaches. London: Sage Publications.
  • Qu, Wen, and Leung, Philomena. (2006). 'Cultural Impact on Chineese Corporate Disclosure- a Corporate Governance Perspective'. Mangerial Auditing Journal. Vol. 21(3). pp. 241–264.
  • ROSC. (2005). Report on the Observance of Standards and Codes (ROSC). Corporate Governance Country Assessment: Hashemite Kingdom of Jordan. World Bank. Feb.
  • Shanikat, M. and Abbadi, S. 2011. Assessment of Corporate Governance in Jordan: An Empirical Study, Australasian Accounting Business and Finance Journal, 5(3), 93-106.
There are 21 citations in total.

Details

Journal Section Review Article
Authors

Marwa Hassaan This is me

Publication Date June 1, 2013
Published in Issue Year 2013 Volume: 6 Issue: 2

Cite

APA Hassaan, M. (2013). The Arab Perceptions on the Influence of Western Developed Practices on Financial Disclosure Practices- Jordan Evidence. Beykent Üniversitesi Sosyal Bilimler Dergisi, 6(2).

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