IntroductionCompanies usually communicate with shareholders by providing information inside and outside financial reports. In recent years, narrative information contained in financial reports has become longer and more sophisticated. With the growing number of corporate scandals, it has been questioned whether the quality of financial reporting has been compromised by such disclosures. As the statement claims, “Disclosure outside of financial statements is used only to manage the impressions of gullible shareholders.” which generally means that such information deceives shareholders by manipulating their perceptions. Information outside the financial statements includes narrative information within the financial report such as President's statements, CEO statements, future improvement plan, etc. (excludes only income statements, balance sheets, cash flow statements together with associated notes) and that information external to the financial statement. reports available on company websites, press releases. Such as profit warning, sustainable development activities, acquisition intentions, capital expenditures, etc. In a broad sense, impression management refers to the process of someone influencing the perceptions of others. In a corporate reporting context, it means “to strategically display and present information in a way intended to distort readers' perceptions of business results” (M-DB, p.415, taken from Godfrey et al, 2003). In the statement, these types of readers are forced to be shareholders, or more precisely, naive shareholders. They are not sophisticated, they may not have professional knowledge of the stock market, so they are unable to tell the truth or simply believe what they heard. In my opinion, this s...... middle of paper...... information or impression management? Journal of accounting literature, 26, 116–194. Merkl-Davies, D.M., Brennan, N.M. and McLeay, S.J., 2011. Impression management and retrospective sensemaking in corporate narratives: A social psychology perspective. Journal of Accounting, Auditing and Accountability, 24 (3), 315–344.Merkl-Davies, D.M. and Brennan, N.M., 2011. “A Conceptual Framework of Impression Management: New Insights from Psychology, Sociology and Critical Perspectives,” Accounting and Business Research, 41, pp.415-437 (M-DB)Rutherford, B.A., 2003. Obfuscation, textual complexity and the role of regulated narrative accounting disclosures in corporate governance. Journal of Management and Governance, 7(2), 187–210. Yuthas, K., R. Rogers, and J. F. Dillard. 2002. Communicative action and corporate balance sheets. Journal of Business Ethics 41 (1-2): 141-157.