The Use and Perceived Importance of Annual Reports by Accountants in the Service Industry in Malaysia

This study examines the use and perceived importance of annual reports by accountants in Malaysia. Using a postal questionnaire survey, the study focuses on (i) the range of purposes for which respondents use financial reports; (ii) the relative position of annual reports as a source of information compared with other sources of information; and (iii) the relative importance of different parts or sections in a company's annual report. The results indicate that advising clients appears to be their main use of annual reports whereas the least cited reason is to negotiate labour contracts. In addition, advisory services, annual reports, and prospectuses are perceived to be the most important sources of information. The profit and loss statement is also perceived to be the most important part of an annual report, followed by the balance sheet and the notes to accounts. The research findings are, to some extent, consistent with the results of similar studies done in developed as well as developing countries.