Disclosure Level And Compliance With IFRSs: An Empirical Investigation Of Kuwaiti Companies

Abstract

This study empirically investigates the extent of compliance of Kuwaiti listed companies with IAS/IFRSs disclosure requirements, and provides evidence of the factors associated with the level of compliance. The factors examined are: company size, profitability, leverage, liquidity, type of industry, type of auditor, and company age. For this purpose a disclosure index is developed including 101 disclosure items representing 12 IASs. The annual reports of a sample of 48 non-financial companies carefully scrutinized against the disclosure index. The findings of the study indicate that the overall compliance level for the sampled companies averages 69% of the disclosures required by the standards tested. Regression results indicate that only company size and type of industry have positive association with IAS-required disclosures and their coefficients are significantly different from zero. Other explanatory variables are found statistically insignificant.