أثر تطبيق لغة تقارير الأعمال الموسعة على خطر انهيار أسعار الأسهم : دليل من الشركات المدرجة في سوق الأوراق المالية السعودي

Abstract EN

Study Objective: This study aims to investigate the impact of mandatory application of Extensible Business Reporting Language (XBRL) on stock price crash risk of Companies Listed in Saudi stock market.

Study methodology: The study sample consisted of (48) companies listed in the main index of the Saudi stock market, from 2012 to 2019.

Thus the sample represents (384) observations (Firm-year).

The stock price crash risk was measured using three measures; Crash_dummy, DUVOL, and NCSKEW.

To investigate the Impact of mandatory application of Extensible Business Reporting Language (XBRL) on stock price crash risk, logistic regression analysis and ordinary least squares regression analysis were used.

Findings: The results of the correlation analysis indicate that the mandatory application of (XBRL) is significantly and negatively related to stock price crash risk.

The results of the regression analysis also showed that the mandatory application of (XBRL) has a negative impact on stock price crash risk, and this effect is significant, at a 5% significant level, which indicates that the mandatory application of (XBRL) reduces stock price crash risk.

This finding is consistent with the notion that application of (XBRL) makes investors better able to monitor companies and properly assess their performance, which limits managers ability to bad-news withholding and thereby reduces future stock price crash risk.

Originality/Value: The study contributes to the stock price crash risk literature by providing empirical evidence on the impact of mandatory application of (XBRL) on stock price crash risk in emerging markets.