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THE RELIABILITY OF QUARTERLY FINANCIAL REPORTS OF COMPANIES IN MALAYSIA

International Journal of Economics, Management and Accounting

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Title THE RELIABILITY OF QUARTERLY FINANCIAL REPORTS OF COMPANIES IN MALAYSIA
 
Creator Ku Ismail, Ku Nor Izah; Associate Professor, Faculty of Accountancy, Universiti Utara Malaysia,
Sintok 06010, Kedah Darul Aman. Tel: 604 9284902 (e-mail:norizah@uum.edu.my)
Chandler, Roy; Professor of Accounting, Cardiff Business School, Cardiff University, UK
 
Description This study examines the reliability of corporate quarterly reports of Malaysian companies by analyzing the reporting of exceptional items. The quarterly reports are likely to be unreliable if companies tend to defer the reporting of exceptional items to the final quarter. In examining the quarterly reports of 114 companies listed on the Kuala Lumpur Stock Exchange, this study provides evidence that a majority of companies defer the reporting of exceptional items to the fourth quarter. It is also observed that a majority of companies made negative adjustments during the fourth quarter. Therefore, the quarterly reports are likely to be unreliable, and there are reasons to believe that companies manage their quarterly earnings. In addition, this study provides evidence that non-profitable companies defer the reporting of exceptional items to the fourth quarter more than the profitable ones. However, there is no evidence of association between the deferment of the recognition of exceptional items and the size, growth, and leverage of a company.JEL classification: G34, M41Key words: Quarterly financial reporting, Reliability, Earnings management
 
Publisher Kulliyyah of Economics and Management Sciences
 
Contributor —
 
Date 2013-03-01
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://journals.iium.edu.my/enmjournal/index.php/enmj/article/view/112
 
Source International Journal of Economics, Management and Accounting; Vol 13, No 2 (2005)
 
Language eng
 
Relation http://journals.iium.edu.my/enmjournal/index.php/enmj/article/view/112/94