Corporate Annual Report Versus New Sources of Financial Information – Evidence from Emerging Markets

Abstract

This research aims to investigate empirically the perceived importance of various sources of financial information in relation to various investment decisions in two of the emerging markets namely Bahrain and Egypt. It explores how some new sources such as “Company website” and “Specialized websites” stand in relation to other traditional sources. Furthermore, it aims to examine empirically the perceived importance of different sections of the corporate annual report (CR). This study examines the issue from the perspective of three user groups namely “Financial analysts”, “Individual investors” and “Institutional investors” as main groups of users of financial information. In order to gather the data needed for testing related hypotheses, a questionnaire was employed and personally delivered to a sample of 120 respondents in Bahrain and delivered through the electronic mail to a sample of 180 respondents in Egypt. Descriptive and statistical analysis revealed that “CR” was ranked as the most important course of financial information in both countries. The two new sources of financial information, “Company website” and “Specialized websites” were highly ranked as the second and third important sources by users in Egypt. However, they received lower ranking by users in Bahrain. Concerning sections of the corporate report, “Income statement” and “Balance sheet” were ranked as the first and second most important sections of “CR” by investors in both countries.