The impact of financial instruments disclosures on the cost of equity capital
Purpose: This study aims to investigate the impact of financial instrument disclosures under the International Financial Reporting Standard (IFRS) 7 on the cost of equity capital (COEC). Design/methodology/approach: The sample consists of 56 banks listed in the Gulf cooperation council (GCC) stock markets over 7 years from 2011 to 2017. A self-constructed index is used to measure the compliance level in addition to quantitative methods and panel data regression adopted to test the research hypotheses. Findings: The authors find that the compliance level with IFRS 7 does not improve from 2011 until 2017 in the GCC banks. The authors also find that compliance with IFRS 7 disclosures reduces the COEC. Originality/value: The authors also provide new empirical evidence that the level of mandatory financial instruments disclosures under IFRS 7 reduces the COEC. The findings offer policy implications. It shows that compliance with IFRS 7 disclosure requirements leads to desirable economic consequences.
Year of publication: |
2021
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Authors: | Yamani, Amal ; Hussainey, Khaled ; Albitar, Khaldoon |
Published in: |
International Journal of Accounting & Information Management. - Emerald, ISSN 1834-7649, ZDB-ID 2406360-5. - Vol. 29.2021, 4 (05.08.), p. 528-551
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Publisher: |
Emerald |
Saved in:
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