The Comprehensiveness of Cash Flow Reporting in the United Kingdom: Some Characteristics and Firm-specific Determinants

Abstract

We report the results of a study of the characteristics and comprehensiveness of disclosure in cash flow statements (CFSs) published in the 1995 annual reports of UK firms and their relationships with selected firm-specific characteristics. Based on the data from a sample of 200 firms, our results suggest that the comprehensiveness of cash flow reporting is (1) an increasing function of firm size (however defined) and (2) a decreasing function of return on sales. There are significant differences in cash flow reporting comprehensiveness among industrial groups and between positive and negative net cash flows firms. However, our results also suggest that cash flow reporting comprehensiveness is not associated with net cash flow per £ worth of equity, liquidity, leverage, and the number of foreign enterprises. Data Availability: The data used in this study were obtained from the annual reports of sample firms and Times 1000.