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The Quality of Corporate Financial Disclosure: A Reply .

Surendra S. Singhvi¹; Harsha B. Desai²

¹ Adjunct Professor of Finance, Miami University of Ohio. 1 · ² Adjunct Professor of Business Administration, University of South Carolina. 2

The article is a reply to a comment by the researchers Michael L. Moore and Stephen Buzby on the author's work, published in the July 1, 1972 issue of the journal "The Accounting Review." According to the authors, Moore and Buzby have made several comments on the index of disclosure, which was used in the authors' research to measure the quality of disclosure in annual reports. To test the effectiveness of their index, the authors compared their results with those of the twenty-sixth annual survey by "Financial World." Moore and Buzby noted that the test is somewhat misleading because "Financial World" only punishes the list of award winning companies and the failure of some of the companies in the bottom 23 percent of our sample to win an award may only mean that they were not among the reports surveyed. As mentioned in the authors' article, only 9 of the bottom 23 percent of their sample companies received merit certificates from "Financial World." One of the comments by Moore and Buzby deals with the index's inability to discriminate. This is not true since variable weights were used in scoring annual reports.

DOI

10.2308/tar-4503358

Volume

47 (3)

Pages

585-586

Language

en

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