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In the context of capital market research what is the importance of published financial information and the information content
Finance & Accounting
Pages 8 (2008 words)
At the same time, Walton notes that financial information has to be credible, otherwise its use may result to a series of severe consequences for the organization, reaching to high penalties from financial authorities or even to the suspension of the firm’s activities, either totally or partially.
Moreover, it has been proved that financial information and information content of earnings have the power to affect the investors’ decision making process. The interaction between the overall model of investor’s decision making and the published financial information, as well as the information content of earnings, is critically discussed in this paper. The justification of the above model in the context of the current financial crisis is evaluated. In order to secure that all the issues discussed above are covered, the paper has been divided into several sections, highlighting the various aspects of this paper’s subject. Apart from the introduction section, where the overall scope of the paper is presented, of particular importance are the literature and the Discussion sections. In the literature review section the following issues are addressed: the key characteristics of market research and its value on financial reporting, the published financial information and the information content of earnings as factors influencing investors’ decision making and potential use of the model of investors’ decision making within modern market which is under the continuous pressures of global financial crisis. ...
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