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Summary annual reports: length, readability and content

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  • Michael E. Bradbury
  • Pei___Chi Kelly Hsiao
  • Tom Scott

Abstract

This paper examines summary annual reports (SAR) as an alternative channel for communicating financial information. We use a sample of New Zealand local governments (councils) that are required to report audited SAR. Using various measures, we compare document length and readability of SAR and annual reports (AR). We find that SAR are approximately 10 percent of the AR length and both have a ___very difficult___ readability score. We then use a disclosure index to examine the relation between SAR report length and the level of disclosures. After controlling for other factors that impact the level of disclosure, we conclude that the reduction in SAR is driven by lower levels of content. We then discuss the policy implications of our findings.

Suggested Citation

  • Michael E. Bradbury & Pei___Chi Kelly Hsiao & Tom Scott, 2020. "Summary annual reports: length, readability and content," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 60(3), pages 2145-2165, September.
    • Handle: RePEc:bla:acctfi:v:60:y:2020:i:3:p:2145-2165
    DOI: 10.1111/acfi.12370
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    References listed on IDEAS

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    Cited by:

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    2. Jia, Jing & Li, Zhongtian, 2022. "Risk management committees and readability of risk management disclosure," Journal of Contemporary Accounting and Economics, Elsevier, vol. 18(3).

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