SUMMARY
It is recognized that multinational corporations (MNC) have played a significant role in the recent worldwide accounting reform. This study aims to explore and analyse the influence of foreign ownership and MNC on financial disclosure practices of listed companies from Central and Eastern European countries (CEE), as an evidence of their contribution to regional financial reporting development. Moreover, the opposite effect, the role of disclosure in attracting foreign investments is investigated. These associations were empirically tested through fixed effects panel analysis conducted for 2005-2015 period, in the context of partial IFRS adoption in CEE. It was found that foreign shareholders may determine a change in disclosure practices of their investees due to their monitoring tendencies and need of comparability of financial information. Furthermore, foreign corporate owners have to impose their own reporting policies which may diminish the extent of disclosure of foreign subsidiaries. On the other hand, foreign investors do not seem sensitive to individual items changes in reported information, these evidences raising questions regarding the purpose and impact of disclosure on financial markets. Questioning the importance of financial disclosure, this study may give a signal to standard-setters about reporting practices at regional level. Adding an original empirical contribution to reporting behaviour and corporate transparency literature by providing evidences from CEE countries, the present study invites to further research on reporting practices of companies with foreign ownership.