Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)


The Determinants of Forward-Looking Information Disclosure in Annual Reports of Lebanese Commercial Banks

Author(s): Rasha Mohamad Mahboub

Nowadays disclosure of information is not restricted to financial information in the context of financial reports, but they often reveal a bunch of non-financial information –such as forward looking information to influence the decisions of users. For this purpose, this research investigates empirically the factors that may affect the extent to which forward-looking information is disclosed in the narrative sections of the annual reports of a sample of 29 Lebanese commercial banks for the period 2008-2017. This information will aid bank shareholders to make informed decision about the bank's future performance. Disclosure index methodology was adopted for each bank in the sample. The results indicate that three of the bank specific characteristics i.e., size, leverage and age have an insignificant association with the level of forward-looking information disclosure; whereas profitability, liquidity, and capital expenditures are found to have a positive effect on the level of this disclosure. The results of this research can be valuable not only for academics wishing to improve their knowledge about forward- looking information disclosure, but also for managers and regulators wishing to set up new policies in Lebanon and other developing countries in particular. Consequently, the research recommends Lebanese commercial banks to provide more forward-looking information in their annual reports to efficiently decrease informational asymmetries between the management and owners of the banks.

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