“Globalco, Inc.”, “US Dollars”, “250,000” and “December 31, 2003”, accompanies
the XBRL tag, this creates reusable business information that can be consolidated and
deconsolidated and aggregated and de-aggregated. Mapping an entity’s quantitative
data to the appropriate XBRL tags will undoubtedly enhance the overall transparency
of financial disclosures.
(c) Survey of Auto Companies’ Internet Disclosures. Our survey of auto companies’
Web based disclosures strongly supports the view that the World Wide Web is now a
critical method of information dissemination.
Exhibit 13.21 presents a tabular summary of information available from the Web
sites of Fiat, Ford, Hyundai, Jiangling, Toyota, and Volkswagen. It shows that all of
the companies except Jiangling make extensive information available on their Web
sites, including press releases, information from analyst meetings and presentations,
and information for shareholders (related to the annual general meeting), as well as
providing access to periodic financial reports (including SEC filings). Exhibit 13.22
presents a qualitative comparison of information about the Web sites.
13.11 SUMMARY AND IMPLICATIONS FOR FINANCIAL STATEMENT USERS AND
MANAGERS. The discussion and illustrations in this chapter have important impli-
cations for financial statement users and for corporate managers responsible for fi-
nancial reporting and disclosure. First, it appears that global standards in financial re-
porting are developing. Up to only a few years ago, many jurisdictions (including
France, Germany, and Japan) did not require such financial disclosures as those re-
lated to cash flows and segments. Managers at many large multinational companies
did not think that the benefits of disclosing such information would justify the costs.
Now, most countries require such disclosures.
Vast differences in mandatory disclosure for listed companies remain. For ex-
ample, U.S. financial statement users should not expect all “world-class” non-U.S.
companies to disclose “sensitive” information, such as details about directors and
corporate officers’ compensation and share ownership. Such disclosures simply
are not required in many jurisdictions outside the United States, where it is gener-
ally believed that the potential costs to companies in making such disclosures out-
weigh the capital market benefits of making the disclosures. The high cost of dis-
closure continues to persuade many non-U.S. companies to stay out of U.S. capital
markets.
Empirical evidence supports the view that increased disclosure improves the mar-
ket liquidity of a company’s shares. It is widely accepted that managers who decide
to provide enhanced disclosures in areas considered important to investors and ana-
lysts might obtain a competitive advantage over firms with narrower disclosure poli-
cies. Further study of the costs and benefits of enhanced disclosure in international
settings should provide important evidence in this area.
To know what to expect a company to disclose and to understand managers’ dis-
closure incentives, one must be familiar with the (global) capital markets in which
the company operates, its ownership structure, and the corporate finance and gover-
nance characteristics of its home market. Therefore, financial statement users should
continue to expect wide variation in disclosure levels, financial reporting practices,
and free availability of information on company Web sites.
13 • 40 CORPORATE FINANCIAL DISCLOSURE: A GLOBAL ASSESSMENT