This Study
investigates with the deficiency of financial reports in providing
non-financial information, which has become one of the most important
information that users need. It also examines the role of the sustainability
report as one of the voluntary disclosure mechanisms in providing non-financial
information and its impact on supporting relevance level of information
contained in the financial reports as well as the impact on supporting
financial reports ability to communicate effectively with its users.
Methodology:
To verify the validity of the
study hypotheses, this study conducted experimental investigation on companies
listed on the Saudi Exchange Index MSCI Tadawul 30, for the period of three
years 2017, 2018 and 2019
Practical Results:
The results of experimental
Study showed a low rate of availability of non-financial information in the
financial statements of companies listed with an MSCI Tadawul 30 index. The
results also showed that the sustainability report supported by proposed
development has an important role in increasing the level of relevance of the
information contained in the financial reports to the needs of its users.
Authenticity/ Value:
The research significance is
further established through the study by IFAC discussion of the necessity to
consider sustainability as an essential pillar of the financial reporting
process, as it is a primary driver of the value creation process within the
company. Sustainability reports will also allow the following:
- Understanding the establishment performance
and its economic, environmental, and societal impacts.
- Awareness of risks and opportunities
surrounding operations.
- Identifying the problems that concern
stakeholders.
- Understanding the nature of the
broader concept of sustainability and what it requires of understanding the
impact of operations on national economic performance.
