THE DETERMINANTS OF INTERNET FINANCIAL REPORTING IN PAKISTAN

Abstract

Internet financial reporting is the dissemination of firm's financial and performance information via
Internet. This form of reporting made the voluntary disclosure much easier. As there are additional
costs for printing and mailing information, when investors are widely dispersed. Internet financial
reporting has multiple advantages of timeliness, cost efficient, wider reach and availability at the
same time to all stakeholders. And when the information is available to all stakeholders at the same
time it lowers the information asymmetry and leads to transparency. This study is based on the
determinants of internet financial reporting in banking sector of Pakistan. Firm size, ratio of market
value to book value, firm leverage and firm foreign listing were used as variables to explain the
internet financial reporting in commercial banking sector of Pakistan. The result shows that there is a
positive association among internet financial reporting, firm size, firm leverage and foreign listing.
The result further concluded that firm size and ratio of market value to book value have significant
positive impact on internet financial reporting while firm leverage and foreign listing have
insignificant positive impact on internet financial reporting for commercial banks in Pakistan. The
internet financial reporting was calculated by adopting the disclosure index used by Debreceny et al.
(2001).