Corporate Financial Communication and Voluntary Disclosure
Faculty of Business and Law
School of Accounting, Finance and Business Economics
A method is required for assessing the decision usefulness of management disclosures; this has implications for both the formulation of accounting policies and the regulation of financial disclosure. Currently massive sums of money are devoted to voluntary disclosures, without their being any clear indication of matching benefits accruing to either stakeholders (as users of the disclosures) or enterprises (as producers). We have theories, e.g. agency theory (Jensen &Meckling, 1976), and signalling theory (Ross, 1979), to provide motivation for voluntary disclosures, but precious little convincing empirical evidence either for their relevance or their implications. Yet the area of corporate financial communications remains vastly under-researched, a concern which ,is addressed in this special issue of the journal. The number of researchers worldwide actively addressing accounting communication issues is an exclusive club, so that we are fortunate in this issue to include contributions from five of those right at the cutting edge of research in the area: Vivien Beattie, Mike Jones, John Courtis, Pauline Weetman, and myself. The papers themselves address a number of communication aspects, which might be classified as being focused on 'content' or 'presentation' issues, though there is some overlap. A joint consideration of each of the areas generates, as we shall see, an interesting research agenda. This issue explores disclosure indices, to measure information quantity, content analysis methods, to measure quality of information and the emphasis on particular themes, and alternative measures of the quality of presentation.