This thesis proposes a multi-theoretical framework based on information asymmetry and institutional theories by focusing on the period of change in OFR regulation from 2004-2006. As a means of examining various aspects of the proposed framework, this thesis carries out an empirical investigation to find the extent of forward-looking information for a sample of 690 UK non-financial firm-year observations which are drawn from the top 500 UK listed firms by total market capitalization as listed by Financial Times on 30 March 2007. The investigation concentrates on three aspects: (1) the association between the extent of voluntary disclosure of forward-looking information and both information asymmetry and institutional characteristics; (2) the association between changes in disclosure and information asymmetry and institutional characteristics; and (3) the association between disclosure of cash flow forecasts and industry behaviour. Before examining the extent of FL information, another subsidiary objective arises: to investigate the impact of alternative methods choice on the measurement of information. Different methods of disclosure indices and content analysis (an un-weighted index, a weighted index, a frequency count, a manual content analysis, and a computerised content analysis using coding by text unit as a unit of analysis and coding by sentence as a unit of analysis) are conducted on a sample of 30 UK non-financial companies for 2006. Once the disclosure scores are computed, several set of analyses are performed (descriptive analysis, correlation matrix, multiple regression analysis, and ranking). The results of analyses reveal that, on average, alternative methods of measurements provide quite similar inferences; hence, a trade-off should be made to decide upon a method by which to measure the extent of FL for a large sample. Computerised content analysis using a text unit as a unit of analysis is chosen to perform coding for the large sample. For the purpose of testing the study hypotheses, both parametric and non-parametric tests are undertaken to examine how firm characteristics affect the level of forward-looking information. The results of regression analysis indicate that the extent of voluntary disclosure of FL information is positively and significantly related to growth opportunities, leadership, audit committee, competition rate, corporate size, and cross-listing. However, the extent of FL information is negatively and significantly associated with blockholding of 5% or more. In terms of changes in the extent of disclosure, the results show that changes in capital need is positively and significantly related to changes in disclosure, whereas changes in analyst following, blockholding of 5% or more, and corporate size are negatively and significantly related to changes in the extent of disclosure among consecutive years. In order to examine the relationship between industry behaviour and the extent of forward-looking information, disclosure of cash flow forecasts is chosen as a proxy for forward-looking information. This is done, because of the difficulty of measuring the disclosure practices of other companies in the same industry by means of a scoring sheet. The results of logistic regression analysis document that operating cash flow, industry behaviour, cross-listing, and company size are positively and significantly related to disclosure of cash flow forecasts, whereas performance and competition rate are negatively and significantly related to disclosure of cash flow forecasts
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:531844 |
| Date | January 2010 |
| Creators | Abed, Suzan |
| Publisher | University of Aberdeen |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Source | http://digitool.abdn.ac.uk:80/webclient/DeliveryManager?pid=158300 |
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