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Digest Finance

Analysis of interrelation between the financial status and the level of corporate transparency of annual financial statements of Russian companies

Vol. 26, Iss. 2, JUNE 2021

PDF  Article PDF Version

Received: 19 April 2018

Received in revised form: 27 April 2018

Accepted: 10 May 2018

Available online: 29 June 2021


JEL Classification: G32, M21, M49

Pages: 195211


Mariya S. SHILOVSKAYA Yuri Gagarin State Technical University of Saratov (Gagarin SSTU), Saratov, Russian Federation

ORCID id: not available

Subject. The form of annual financial statements presentation by the company management to a great extent depends on conditions impacting the financial position of the company at the time of reporting. The article investigates the reaction of management to these conditions and the way it expresses its opinion about the company's current position and development prospects.
Objectives. The goal is to analyze relationships between the quality of management's narrative disclosures in financial reviews within annual reports and the company's financial position, and to consider the effect of the risk of bankruptcy.
Methods. The study employs methods of semantic analysis of the texts of the reports and the correlation analysis.
Results. The paper summarizes the results of semantic analysis to determine the management opinion about the company's ability to create value in the short, medium and long term. It also presents the results of correlation of companies financial ratios and the management opinion about the company's financial standing.
Conclusions and Relevance. Companies with stable financial position present more transparent corporate information; and information disclosure of companies with aggravating financial situation is of low quality. I offer recommendations for improving the quality of information to be disclosed.

Keywords: integrated reporting, financial standing, correlation analysis, semantic analysis, bankruptcy risk


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