Risk Disclosure: Evidence from Malaysian Listed Firms

Journal of Financial Regulation and Compliance Vol. 17 No. 1, 2009 pp. 57-69

Emerald Group Publishing Limited, 1358-1988, 2009, DOI 10.1108/13581980910934045

13 Pages Posted: 15 Oct 2012

See all articles by Radiah Othman

Radiah Othman

Massey University

Rashid Ameer

IPU New Zealand Tertairy Institute

Date Written: October 15, 2012

Abstract

Purpose- The purpose of this paper is to investigate the market risk disclosure practices among Malaysian listed firms. Specifically, it aims to examine the level of compliance with FRS132: Financial Instruments - Disclosure and Presentation for financial periods beginning or after 2006.

Design/methodology/approach- The approach taken is content analysis and coding procedure.

Findings- Although a large number of companies have shown compliance with FRS132 in relation to disclosing the financial risk management policy, there are systematic differences across companies in terms of level of details (i.e. qualitative and quantitative) disclosure. Interest rate disclosure was the most mentioned category and the credit risk was the least mentioned category of market risk. There is telling evidence that most Malaysian firms did not engage in hedging any type of market risk over the reporting period of 2006-2007.

Research limitations/implications- There is a need for some standardized risk reporting format to achieve greater financial transparency to make investors aware of the market risks.

Originality/value- This is believed to be the first study to provide survey findings on the use of derivatives instruments by listed firms in Malaysia.

Keywords: Disclosure, Financial reporting, Malaysia, Financial risk

Suggested Citation

Othman, Radiah and Ameer, Rashid, Risk Disclosure: Evidence from Malaysian Listed Firms (October 15, 2012). Journal of Financial Regulation and Compliance Vol. 17 No. 1, 2009 pp. 57-69 , Emerald Group Publishing Limited, 1358-1988, 2009, DOI 10.1108/13581980910934045, Available at SSRN: https://ssrn.com/abstract=2162173

Radiah Othman (Contact Author)

Massey University ( email )

School of Accountancy
Palmerston North
New Zealand

Rashid Ameer

IPU New Zealand Tertairy Institute ( email )

57 Aokautere Drive
Fitzherbert
Palmerston north
New Zealand

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