Journal of Contemporary Issues in Business and Government

Abstract

The study investigates empirically the perceptions of users of financial statements (especially
university students) on the various aspects of Internet Financial Reporting (IFR). Further, this
study examines the factors that influence companies in Sri Lanka to engage in IFR. The
advantages and disadvantages of using this new technology for financial reporting were also
discussed. Users’ perceptions on financial statements were sought using a survey mailed
questionnaire. The findings of this study suggested six main factors that companies to engage
in IFR: Enhancingthe corporate image, companies in line with the development of
technology, competition in the industry, stabilizing and enhancing share prices, receiving
government support, and societal responsibility.The findings also revealed three factors that
inhibit firms from engaging in IFR: required expertise from the company, need to keep the
information updated to be of use, and concern over information security. Another significant
result revealed increased information and analysis, navigational ease, global reach, and mass
communication as the three most important advantages of financial reporting on the
internet.Moreover, security problems are the disadvantages of placing financial information
on the internet. The evidence on Sri Lanka is relevant to other emerging capital markets.
Finally, This study provides the knowledge gap in user’s perceptions of IFR and also it is
expected to have significant policy implications.