A Model for Users' Understanding of Information Overload in Financial Reporting

Document Type : Research Paper

Authors

1 Department of Accounting, Marand Branch, Islamic Azad University, Marand, Iran

2 Department of Accounting, Khatam University, Tehran, Iran

10.22059/ijms.2025.377239.676773

Abstract

Objective: This study develops a systematic model for users’ understanding of information overload in financial reporting, using grounded theory. The statistical population consists of professional experts and capital market participants, with 13 individuals selected through snowball sampling. Managing information overload is crucial for enhancing the usefulness and reliability of financial reports and supporting decision‑makers. Methodology: Data were collected via semi‑structured interviews and analyzed through three coding stages—open, axial, and selective—using MaxQDA software. The coding process identified patterns, categories, and relationships consistent with grounded theory principles. Results: The analysis produced macro‑categories, main categories, and subcategories describing the causes, influences, and consequences of overload. Findings indicate that excessive or complex disclosures cause misinterpretation, raise information asymmetry, reduce market liquidity, increase transaction costs, and elevate capital costs. These outcomes underline the urgency of implementing effective controls over disclosure practices to safeguard report clarity and usefulness. Innovation: Few national or international studies examined the detailed patterns of overload in financial reporting. The model is original, integrating practical and theoretical contributions. It offers recommendations for policymakers, auditors, and preparers to reduce overload, improve comprehension, enhance decisions, and raise reporting quality, while linking behavioral insights with technical aspects of disclosure.

Keywords

Main Subjects

References

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Interdisciplinary Journal of Management Studies
Volume 19, Issue 2
April 2026
Pages 267-279

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