Laivi Laidroo () (Department of Economics at Tallinn University of Technology)
Abstract
Previous literature has been occupied with measuring disclosure quality in financial reports and no indication has been provided on how the quality of public announcements could be measured. The purpose of this paper is to introduce a methodological approach to its measurement and to illustrate its implementation possibilities in the context of Tallinn, Riga and Vilnius Stock Exchanges. The disclosure quality measure proposed was based on six quality attributes (informativeness, relevance, precision, rarity, frequency, and unexpectedness) defined in the context of information theory and operationalised through finance/accounting and cognitive psychology theories. Implementation in the context of three capital markets confirmed that there has been an increase in disclosure quality over time. Company size and stock exchange where the company was listed affected its disclosure quality level. Main areas for disclosure quality improvement were identified and the results also indicated that small firms and companies with low quality disclosures tended to be less prone to disclosure quality improvement.
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Publisher Info
Paper provided by School of Economics and Business Administration, Tallinn University of Technology in its series Working Papers with number
181.
Length: 23 Date of creation: 2008 Date of revision: Publication status: Published in Working Papers in Economics.School of Economics and Business Administration,Tallinn University of Technology (TUTWPE), Pages 5-27 Handle: RePEc:ttu:wpaper:181
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