The Accounting Standards and Reporting Framework of the Organization

Added on -2020-02-18

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RUNNING HEAD: Research on accounting issues1Name of the Student-Title-Research proposal (Reaction of capital market to financial reporting)University Name-
Research on accounting issues2Abstract This research has shown the details study on the reaction of capital market on thefinancial statement of company. In this research, study has been conducted on how the shareprice of companies around the globe has destructed their values due to the less effectivecompliance with International financial reporting standards in their reporting frameworks andchanges in earning of company. This paper investigates the relations between annual reportdisclosure, market liquidity, capital cost in the market and fluctuation of capital market on thereporting frameworks of organization. This research has identified the problems and uncertaintyof changes in share price of company in capital market which arise due to less effective reportingcompliance program.
Research on accounting issues3Table of ContentsAbstract.......................................................................................................................................................2Introduction.................................................................................................................................................4Research question...................................................................................................................................4Key issues................................................................................................................................................4Impact of earning on the capital market reaction...................................................................................5Capital market reaction due to the changes in earning given by large companies......................................7Use of financial information such as ROI, Cash inflow and earning of companies in market by the investors before making investment in capital market...............................................................................8Legal reporting compliance and its impact on the capital market...............................................................9Limitation of research on impact of earning and its impact on the capital market...................................10Conclusion.................................................................................................................................................11Finding of this research.............................................................................................................................11References.................................................................................................................................................13
Research on accounting issues4Introduction In this report, it is given that reporting frameworks of organization are depends upon theaccounting standards and reporting framework of organization. Capital market fluctuation ishighly dependent upon the disclosure of information of companies whose shares are listed instock exchange. This research contains the information related to impact of earning to thereaction of capital market. With the increasing ramified economic changes, capital market isdepended upon the various macro and micro factors such as economic policies, investor’sbudget, foreign direct investment and company’s financial reporting frameworks. However, inorder to win over the investors trust in capital market, many big listed companies are followinginternational financial reporting standards in determined approach. This research has alsoreflected the key understanding on the factors affecting the fluctuation of capital market and itsrelation with the earning of companies Research questionWhat is the impact of earning on the capital market reaction?Key issues There are several issues and factors that have bearing on the capital market reactions dueto the changes in earning. However, due to the uncertainty of market factors and capital marketreactions, various investors have to face high amount of loss in their capital when they investtheir money in capital market. The main problem in this research is to quantify the impact ofearning on the capital market reaction (Grewal, Riedl, and Serafeim, 2015).

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