The Irrelevance of Financial Statements from Parastatals in Tanzania
AbstractThe use of financial statement information has been well documented. It is expected to facilitate decision making pertinent to the user. However, financial statement information is useful only if it is available on time. This study sought to establish whether financial statements from Tanzania parastatals were availed on time, and if not, whether the delay was significant. Using the Normal Approximation Rule to test for significance in mean time difference, it was found that parastatals delayed in releasing financial statements. The difference in mean time for their release was found to be significant at the 1 percent significance level. It is thus concluded that information provided by financial statements from Tanzania parastatals was no longer relevant at the time it was available. Decisions made on the basis of that information, it is argued, were misguided.
African Journal of Finance and Management Vol.8(1) 1999: 7-13