School of Accountancy (ETDs)

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Browsing School of Accountancy (ETDs) by Keyword "Annual Report"

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    The frequency and quality of graphs in annual reports: a South African analysis of graph disclosure in listed entities
    (2020) Varachia, Zakiyyah
    The Annual Report is viewed as an important communication medium between a company and its stakeholders. The format of the Annual Report has undergone changes over time due to the introduction of integrated reporting and the demands stakeholders have placed on companies to provide a holistic view of the company. As part of the change in the format of the annual report the use of visual representation such as graphs, tables and photography has become a more prevalent feature of the Annual Report. The purpose of the study was to analyse the incidence, quality and measurement distortion of graphs in the Annual Integrated Reports of the Top 100 South African listed entities for the financial year ending 2017. A graph which does not comply with good graph guidelines and a graph which exhibits measurement distortion provide a company with the opportunity to engage in impression management and to alter the perceptions of users of the information. The result is that the information presented is not fair and contains management bias. The findings of the study indicate that graphs are used widely as a communication tool in the Annual Reports of South African listed companies to convey both financial and non-financial information. The widespread use of graphs is not without its problems and it was identified that for a large number of graphs displayed in the annual report, impression management was present. It would appear that South African listed companies do not use presentational enhancement to a large degree as an impression management tool but the graphs presented displayed significant measurement distortion, implying that graphs are used as a means to change users’ perceptions of a company. Further, where significant measurement distortion was present, it was identified that graphs tend to overstate the underlying trend as opposed to an understatement of trends. It can be concluded that companies use graphs as a means to alter users’ perceptions of the underlying trends depicted which, in turn, has the ability to alter the company’s image in the public domain