A comparative study of the use of financial graphs in the corporate annual reports of major U.S. and U.K. companies

Beattie, Vivien and Jones, Mike (1997) A comparative study of the use of financial graphs in the corporate annual reports of major U.S. and U.K. companies. Journal of International Financial Management and Accounting, 8 (1). pp. 33-68. ISSN 0954-1314

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Abstract

The use of graphs to disclose information in corporate annual reports represents a significant dimension in financial disclosure management. Surprisingly, no inter-country comparative analysis of this area of voluntary disclosure has been conducted. This study compares the graphical reporting practices in the 1990 annual reports of 176 leading U.S. and U.K. industrial companies. Ninety-two per cent of U.S. companies use graphs compared with 80% of U.K. companies; the mean number of graphs per company being 13.0 and 7.7, respectively. Sales, an earnings measure, earnings per share and dividends per share are the four most frequently graphed aggregate financial performance variables in both countries. Significant differences in several of the variables graphed are found and explained in terms of environmental factors. In both countries, evidence of graphical information manipulation exists in the form of selectivity, measurement distortion, and presentational enhancement. Moderate evidence supports the hypothesis that U.K. companies are more likely than U.S. companies to adopt interpretative shading. Regulators need to clarify the responsibilities of directors and auditors by setting graphical guidelines.

Item Type:
Journal Article
Journal or Publication Title:
Journal of International Financial Management and Accounting
Uncontrolled Keywords:
/dk/atira/pure/subjectarea/asjc/2000/2003
Subjects:
?? financebusiness, management and accounting (miscellaneous)accounting ??
ID Code:
66463
Deposited By:
Deposited On:
17 Sep 2013 08:11
Refereed?:
Yes
Published?:
Published
Last Modified:
15 Jul 2024 14:13