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Value relevance of voluntary risk disclosure levels: evidence from Saudi banks

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Value relevance of voluntary risk disclosure levels : evidence from Saudi banks. / Al-Maghzom, Abdullah ; Hussainey, Khaled; Aly, Doaa.

In: Accounting and Taxation, Vol. 8, No. 1, 02.2017, p. 1-26.

Research output: Contribution to journalArticle

Harvard

Al-Maghzom, A, Hussainey, K & Aly, D 2017, 'Value relevance of voluntary risk disclosure levels: evidence from Saudi banks', Accounting and Taxation, vol. 8, no. 1, pp. 1-26. <http://www.theibfr.com/iaa.htm>

APA

Vancouver

Al-Maghzom A, Hussainey K, Aly D. Value relevance of voluntary risk disclosure levels: evidence from Saudi banks. Accounting and Taxation. 2017 Feb;8(1):1-26.

Author

Al-Maghzom, Abdullah ; Hussainey, Khaled ; Aly, Doaa. / Value relevance of voluntary risk disclosure levels : evidence from Saudi banks. In: Accounting and Taxation. 2017 ; Vol. 8, No. 1. pp. 1-26.

Bibtex

@article{7b0cb07652284328af27150b31923462,
title = "Value relevance of voluntary risk disclosure levels: evidence from Saudi banks",
abstract = "This study seeks to examine whether the levels of voluntary risk disclosure in Saudi listed banks are value-relevant or not. The sample of this investigation consists of all banks listed on the Saudi Stock Market Exchange (Tadawul). All data was collected from the annual reports of the sample banks from 2009 to 2013 using manual content analysis. Other variables were collected using DataStream and Bloomberg. Ordinary least squares regressions analysis was used. The findings of the multivariate analysis demonstrated that there is no association between the levels of voluntary risk disclosure and firm value as measured by the market to book value at the end of the year (MTBV). But, the results generate from the accounting based measure (ROA) show that there is a positively significant association between the levels of voluntary risk disclosure and firm value. This study contributes to the literature on general accounting disclosure and in particular advances and contributes to the literature on risk disclosure in developing economies. It also contributes to the understanding of the role of accounting information in relation to the market valuation of a firm. The empirical findings of this study have several implications for banks{\textquoteright} investors, regulatory bodies and any other interested group as they report the importance of corporate risk disclosure and its economic consequences. This can be used to increase the value relevance in the banking sector. This study also informs regulators about the current level of risk disclosure in all Saudi listed banks.To the best of the researcher{\textquoteright}s knowledge, no prior research has been conducted on the relationship between firm value and levels of risk disclosure in general nor especially in emerging markets, such as Saudi Arabia, the focus of this study.",
keywords = "Banks, Saudi Arabia, Risk Disclosure, Economic Consequences, Firm Value",
author = "Abdullah Al-Maghzom and Khaled Hussainey and Doaa Aly",
year = "2017",
month = feb,
language = "English",
volume = "8",
pages = "1--26",
journal = "Accounting and Taxation",
issn = "1944-592X",
publisher = "The Institute for Business & Finance Research",
number = "1",

}

RIS

TY - JOUR

T1 - Value relevance of voluntary risk disclosure levels

T2 - evidence from Saudi banks

AU - Al-Maghzom, Abdullah

AU - Hussainey, Khaled

AU - Aly, Doaa

PY - 2017/2

Y1 - 2017/2

N2 - This study seeks to examine whether the levels of voluntary risk disclosure in Saudi listed banks are value-relevant or not. The sample of this investigation consists of all banks listed on the Saudi Stock Market Exchange (Tadawul). All data was collected from the annual reports of the sample banks from 2009 to 2013 using manual content analysis. Other variables were collected using DataStream and Bloomberg. Ordinary least squares regressions analysis was used. The findings of the multivariate analysis demonstrated that there is no association between the levels of voluntary risk disclosure and firm value as measured by the market to book value at the end of the year (MTBV). But, the results generate from the accounting based measure (ROA) show that there is a positively significant association between the levels of voluntary risk disclosure and firm value. This study contributes to the literature on general accounting disclosure and in particular advances and contributes to the literature on risk disclosure in developing economies. It also contributes to the understanding of the role of accounting information in relation to the market valuation of a firm. The empirical findings of this study have several implications for banks’ investors, regulatory bodies and any other interested group as they report the importance of corporate risk disclosure and its economic consequences. This can be used to increase the value relevance in the banking sector. This study also informs regulators about the current level of risk disclosure in all Saudi listed banks.To the best of the researcher’s knowledge, no prior research has been conducted on the relationship between firm value and levels of risk disclosure in general nor especially in emerging markets, such as Saudi Arabia, the focus of this study.

AB - This study seeks to examine whether the levels of voluntary risk disclosure in Saudi listed banks are value-relevant or not. The sample of this investigation consists of all banks listed on the Saudi Stock Market Exchange (Tadawul). All data was collected from the annual reports of the sample banks from 2009 to 2013 using manual content analysis. Other variables were collected using DataStream and Bloomberg. Ordinary least squares regressions analysis was used. The findings of the multivariate analysis demonstrated that there is no association between the levels of voluntary risk disclosure and firm value as measured by the market to book value at the end of the year (MTBV). But, the results generate from the accounting based measure (ROA) show that there is a positively significant association between the levels of voluntary risk disclosure and firm value. This study contributes to the literature on general accounting disclosure and in particular advances and contributes to the literature on risk disclosure in developing economies. It also contributes to the understanding of the role of accounting information in relation to the market valuation of a firm. The empirical findings of this study have several implications for banks’ investors, regulatory bodies and any other interested group as they report the importance of corporate risk disclosure and its economic consequences. This can be used to increase the value relevance in the banking sector. This study also informs regulators about the current level of risk disclosure in all Saudi listed banks.To the best of the researcher’s knowledge, no prior research has been conducted on the relationship between firm value and levels of risk disclosure in general nor especially in emerging markets, such as Saudi Arabia, the focus of this study.

KW - Banks

KW - Saudi Arabia

KW - Risk Disclosure

KW - Economic Consequences

KW - Firm Value

UR - http://www.theibfr.com/cright.htm

M3 - Article

VL - 8

SP - 1

EP - 26

JO - Accounting and Taxation

JF - Accounting and Taxation

SN - 1944-592X

IS - 1

ER -

ID: 4522917