Disclosure of Financial Information and Corporate Governance
affiliation not provided to SSRN
February 16, 2012
Financial accounting information is the product of corporate accounting and external reporting systems that measure and routinely disclose audited, quantitative data concerning the financial position and performance of the publicly held firms. Audited balance sheets and income statements and cash flow statements along with the supporting disclosures form the foundation of the firm specific information set available to investors and regulators. The disclosure has been a most efficient and effective mechanism for inducing managers to manage better. It promotes a fair and efficient capital market. It is the assumption behind many disclosure requirements that behavior can be influenced merely by requiring it to be disclosed. The information disclosed enables the shareholders, investors, creditors and other persons who are interested in the affairs of the company to have better understanding of the affairs of the company. The Company’s Act, 1956, requires the disclosure in balance sheet, auditor’s report, director’s report and the reports to registrar of companies and the Securities and Exchange Board of India (SEBI). Enhanced disclosure is adopted so as to give better control of corporations. The contents of financial reports and the statement attaching to it, strives to achieve greater corporate transparency.
Number of Pages in PDF File: 9
Keywords: corporate governance, accounting, auditors
Date posted: February 18, 2012