Standard business reporting in Australia: Efficiency, effectiveness, or both?

Robb, David A., Rohde, Fiona H., & Green, Peter F. (2016) Standard business reporting in Australia: Efficiency, effectiveness, or both? Accounting and Finance, 56(2), pp. 509-544.

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Abstract

The benefits of using eXtensible Business Reporting Language (XBRL) as a business reporting standard have been widely canvassed in the extant literature, in particular, as the enabling technology for standard business reporting tools. One of the key benefits noted is the ability of standard business reporting to create significant efficiencies in the regulatory reporting process. Efficiency-driven cost reductions are highly desirable by data and report producers. However, they may not have the same potential to create long-term firm value as improved effectiveness of decision making. This study assesses the perceptions of Australian business stakeholders in relation to the benefits of the Australian standard business reporting instantiation (SBR) for financial reporting. These perceptions were drawn from interviews of persons knowledgeable in XBRL-based standard business reporting and submissions to Treasury relative to SBR reporting options. The combination of interviews and submissions permit insights into the views of various groups of stakeholders in relation to the potential benefits. In line with predictions based on a transaction-cost economics perspective, interviewees who primarily came from a data and report-producer background mentioned benefits that centre largely on asset specificity and efficiency. The interviewees who principally came from a data and report-consumer background mentioned benefits that centre on reducing decision-making uncertainty and decision-making effectiveness. The data and report consumers also took a broader view of the benefits of SBR to the financial reporting supply chain. Our research suggests that advocates of SBR have successfully promoted its efficiency benefits to potential users. However, the effectiveness benefits of SBR, for example, the decision-making benefits offered to investors via standardised reports, while becoming more broadly acknowledged, remain not a priority for all stakeholders.

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ID Code: 78037
Item Type: Journal Article
Refereed: Yes
Keywords: Standard Business Reporting, Business reporting, Transaction cost economics, Efficiency, Effectiveness
DOI: 10.1111/acfi.12094
ISSN: 1467-629X
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > ACCOUNTING AUDITING AND ACCOUNTABILITY (150100)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Accountancy
Copyright Owner: Copyright 2014 AFAANZ
Deposited On: 26 Oct 2014 23:53
Last Modified: 12 Jul 2016 23:50

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