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Corporate Governance and the Level of Compliance with International Accounting Standards (IAS-1): Evidence from Bahrain Bourse

International Research Journal of Finance and Economics, Issue 157, 2016

13 Pages Posted: 13 Jan 2017  

Abdalmuttaleb M.A Musleh Al-Sartawi

Ahlia University

Fatema Alrawahi

Ahlia University

Zakeya Sanad

Ahlia University

Date Written: December 20, 2016

Abstract

Harmonization of financial reporting standards reduces information asymmetry and improves the confidence of users of financial information while making decisions .Similarly, corporate governance enhances the transparency of financial information through reducing agency conflicts. Moreover, in order to increase the confidence of investors, attract prospective investors and reduce conflict of interests, Bahrain encourages firms to adhere to both the International Financial Reporting Standards and Bahrain’s Code of Corporate Governance. Accordingly, the purpose of this paper is to investigate the relationship between corporate governance and the level of compliance by 39 firms listed on Bahrain Bourse with International Accounting Standards (IAS-1). The results indicate that the level of corporate governance applied in Bahrain listed companies was 72.5% and it has a significant relationship with the level of compliance with IAS-1 disclosure. The findings and recommendations presented in this study might support regulatory bodies and standard setters in Bahrain to formulate strategies that would promote compliance with IFRSs by the listed firms. Additionally, the study contributes to financial reporting literature relating to the GCC countries.

Keywords: Harmonization, Corporate Governance Level, Compliance, IFRS, Bahrain

Suggested Citation

Musleh Al-Sartawi, Abdalmuttaleb M.A and Alrawahi, Fatema and Sanad, Zakeya, Corporate Governance and the Level of Compliance with International Accounting Standards (IAS-1): Evidence from Bahrain Bourse (December 20, 2016). International Research Journal of Finance and Economics, Issue 157, 2016. Available at SSRN: https://ssrn.com/abstract=2898145

Abdalmuttaleb M.A Musleh Al-Sartawi (Contact Author)

Ahlia University ( email )

P.O. Box 10878
Manama, Manama
Bahrain

Fatema Alrawahi

Ahlia University

Manama_Kingdom of Bahrain
Manama, 00973
Bahrain

Zakeya Sanad

Ahlia University

P.O. Box 10878
Manama, Manama
Bahrain

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