Impact of Islamic Ethical Value and Current Earnings on the Readability of Muslim Chairman’s Statements

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Siti Nabilah M. S. Nur Farizan MAzhani, M. Suryani, A. R Nik Nurul Aswani N, K.

Abstract

The study tries to find the relationship between readability of chairman’s statements with current earnings by distinguishing the religious background of the chairman. This study examines top 100 companies under Main Market in Bursa Malaysia in the year of 2010. The testing of relationship between readability of chairman’s statements and current earnings follows the prediction of management obfuscation hypothesis (Courtis, 1998 and Li, 2008). Obfuscation hypothesis discusses on the management’s practice to purposely make the annual report difficult to read by increasing the length (words per sentence, syllables per word etc) and increasing the usage of jargons in the writing (Sheikh Abu Bakar & Ameer, 2010) in order to hide the adverse current performance, suggesting that the readability is based on the management’s ethic. Since Islam is premised on ethical and moral conduct (Mohd. Ibrahim & Yaya, 2005). It is hypothesised that the differentiation between chairman’s religion should yield significant results.Keywords: Readability, manager obfuscation hypothesis, chairman’s statement, Islamic ethical value

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How to Cite
M. S., Siti Nabilah et al. Impact of Islamic Ethical Value and Current Earnings on the Readability of Muslim Chairman’s Statements. Management & Accounting Review (MAR), [S.l.], v. 12, n. 1, p. 105-121, june 2013. ISSN 2550-1895. Available at: <http://arionline.uitm.edu.my/ojs/index.php/MAR/article/view/199>. Date accessed: 17 jan. 2018.
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