Title: Disclosure of forward-looking information: does overlapping audit committee membership matter?

Authors: Hidaya Al Lawati; Khaled Hussainey

Addresses: College of Economics and Political Science, Sultan Qaboos University, P.O. Box 50, Muscat 123, Oman ' Faculty of Business and Law, The University of Portsmouth, Portsmouth, PO1 3DE, UK

Abstract: We examine whether overlapping audit committee (AC) membership affects the forward-looking content of the chairman reports. We use content analysis to measure levels of forward-looking disclosure (FLD) for forty-eight bank-year observations from eight banks listed on Muscat Securities Market in Oman for the period 2014-2019. Our regression analysis shows that overlapping AC membership positively affects FLD. The evidence from this study suggests that a consideration of AC directors' attributes (e.g., overcommitted AC members) is needed to understand their role in the boardroom or in the subcommittees. An implication of the result is that the Omani corporate governance code should provide guidelines on the type and proportion of the overlapping AC membership. Furthermore, the code could encourage AC members to be overlapped across different committees as this could have a positive impact on corporate disclosure practice. Our study has demonstrated, for the first time, that overlapped AC members enhance the forward-looking content of chairman reports.

Keywords: overlapping audit committee membership; FLD; forward-looking disclosure; chairman reports; content analysis; Oman.

DOI: 10.1504/IJAAPE.2023.133041

International Journal of Accounting, Auditing and Performance Evaluation, 2023 Vol.19 No.3, pp.328 - 359

Received: 07 Jan 2020
Accepted: 21 Oct 2020
Published online: 28 Aug 2023 *

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