Internet financial reporting in an emerging economy: evidence from Jordan

Abstract

Purpose

The purpose of this paper is to examine the status of financial reporting on the internet by companies operating in an emerging economy, namely Jordan.

Design/methodology/approach

The paper surveys 127 companies listed in the first market of Amman Stock Exchange (ASE) for the year ended 2008/2009. The primary sources of the data used in this study are the global and the Jordanian electronic web sites. The paper employs descriptive statistics and nonparametric tests to explore the internet financial reporting (IFR) practices among Jordanian companies.

Findings

The results show that 87 Jordanian companies (69 percent) possess web sites with about 51 percent (44 of the 87) include financial reports and 32 out of 44 companies (about 73 percent) disseminate all their financial information on their web sites. The paper also finds that the extent of disclosure of the corporate financial and nonfinancial information on the ASE web site is statistically different form the companies’ web sites. Furthermore, the current paper reveals that some firm-specific characteristics such as firm size; financial leverage, age, and ownership concentration may distinguish those companies who engage in IFR from their counterparts. Finally, the results suggest that the financial sector is more advanced in terms of using the internet to disseminate information when compared to the industrial and services sectors.

Originality/value

In the context of Jordan, there is limited number of studies attempted to address corporate financial reporting on the internet. Therefore, the present study makes significant contribution to the existing body of knowledge by shedding more light on the status of financial disclosure on the internet by companies operating in an emerging economy like Jordan. Also, the current paper explores the extent of corporate information disclosed on both the official web site of ASE and companies’ web sites.

Citation

T. Momany, M., N. Al-Malkawi, H.-A. and A. Mahdy, E. (2014), "Internet financial reporting in an emerging economy: evidence from Jordan", Journal of Accounting in Emerging Economies, Vol. 4 No. 2, pp. 158-174. https://doi.org/10.1108/JAEE-04-2012-0015