| Companies seek to communicate information to financial markets to raise capital. The strategy of disclosing information is expected to lower the cost of capital and reduce monitoring costs. Although benefits are expected for companies which voluntarily disclose information to user groups, voluntary information disclosure remains a complex and difficult characteristic to measure.; This investigation examines levels of information disclosure in the corporate annual reports of high technology companies and assessed the extent to which five independent variables were associated with levels of information disclosure. Attention focused on the concept of voluntary information disclosure and how agency and proprietary costs affect managers' decisions to disclose certain information. Three hypotheses derived from agency theory and two hypotheses from proprietary costs theory served as the bases for exploring the relationship between voluntary disclosure and the independent variables (managerial ownership, financial leverage, growth opportunity, proprietary costs, and technology innovation information).; The results indicate that firm size, growth opportunity, and technology innovation information were statistically related to the level of information voluntarily disclosed by high technology companies in their annual reports. Size and growth opportunities, as predicted, were positively related to extensive voluntary disclosure by large firms and high growth opportunities firms. However, the positive sign of technology innovation information was not hypothesized. The predictions of agency theory with regard to managerial ownership and financial leverage were not supported. The predictions of proprietary cost theory with regard to profit levels within-industry were not supported in this study. |
