Syahrul Ahmar Ahmad

The Chairman's Statement in Malaysian Companies: A Test of the Obfuscation Hypothesis

Purpose – The obfuscation hypothesis suggests that under-performing firms will tend to obscure the meaning of their corporate narratives by deliberately adopting a textual complexity, most readily apparent through poor readability and the use of unnecessarily difficult language. This paper seeks to add to the literature in the area by comparing the textual complexity of corporate narratives, notably the chairmans statement, of main board and second board companies on the Bursa Malaysia (formerly known as the Kuala Lumpur Stock Exchange), with their financial performance, and also to examine the impact of company size, board membership and degree of statutory regulation on the readability of corporate narratives. Design/methodology/approach – Following the existing literature this paper uses readability as a proxy for textual complexity, in addition to more direct measures, and seeks to examine relationships between textual complexity and various measures of financial performance. Findings – The findings suggest that there are significant relationships between corporate language and financial performance, but that these are not consistent with the obfuscation hypothesis. Originality/value – The findings are consistent with the suggestion that increased regulation and statutory monitoring of disclosures are associated with improved readability of narrative. They do not provide support for the obfuscation hypothesis.

Working Capital Management in Malaysian Government-linked Companies☆

Abstract The purpose of this paper is to examine the influence of working capital management of the government-linked companies on their financial performance. Excluding financial institutions, all government-linked companies listed in Bursa Malaysia were analysed, covering the period from 2003 to 2014. The results provide mixed findings depending on the measure used for the profitability. The results provide useful inputs to the government, particularly the policy makers in enhancing the efficiency of the government-linked companies.

The Web-Based Accountability Practices in Social Enterprises: Validating the Stakeholder Theory☆

Abstract In the absence of shareholders, accountability practices in social enterprises are determined by the strengths of stakeholders. The stakeholder theory postulates that accountability systems depend greatly on the power and number of stakeholders. With the advent of technologies, it is increasingly common to use internet-based technologies in addressing accountability in social enterprises as they pursue hybrid objectives which attempts to balance off both social and economic missions. In view of this, the present study aims to validate the stakeholder theory, focusing on the effect of web-based accountability practices in social enterprises. Based on the Social Enterprise Alliance (SEA) database, all the social enterprises in the database were selected after controlling the type of formation for each social enterprise. The three dimensions of web-based accountability practices showed a low disclosure level on the extent of web-based accountability practices incorporating the three dimensions of finance, performance and political accountability. The results also revealed that social enterprises have less interest in disclosing their financial accountability practices through web sites.