Factors influencing Complexity in Financial Report preparation - Evidence from the Banking Sector in Kenya

• Published in: Journal of economics and business research Vol. 19; no. 1; pp. 219 - 236
• Main Authors: Mutiso, Agnes, Kamau, Charles
• Format: Journal Article
• Language: English
• Published: Aurel Vlaicu University Publishing House 2013; Editura Universității Aurel Vlaicu
• Subjects: Economy; complexity; International Financial Reporting Standards (IFRS), competence; disclosures; regulations
• ISSN: 2068-3537; 2069-9476

The current developments in the business environment as well as in the accountancy profession have significantly affected the way the financial reports are prepared. This study sought to assess the factors influencing complexity of preparing financial reports in the banking sector in Kenya. The objectives included assessing whether disclosures, adoption of International financial Reporting Standard, regulations and lack of competence by the preparers have contributed to the complexity of preparing financial statements. Using a descriptive study design, data was collected from ten banks registered in the Nairobi Capital Market. The study found out that the identified variables positively contributed to complications in the preparation of financial reports. Management interference, lack of guidance on interpretations and frequent updates of the standards were identified as the main challenges in preparing financial reports. Several recommendations were given to help simplify the process of preparing financial statements