BA 3340 Lecture Notes - Lecture 99: Root Mean Square, Capital Market, Historical Cost
Document Summary
13. 2 the purpose of financial statement analysis and good. Stakeholders are organisms that have an interest in the company o. Companies needs to inform stakeholders about posi:ve and nega:ve events (required by the standards) Public companies are forced to inform shareholders immediately. Public companies needs to inform shareholders immediately but they don"t have to give up as much informa:on as in the strong markets o. Good accoun:ng quality can be discussed based on the following three dijerent accoun:ng users (the dijerent items explain what should be done to ensure high accoun:ng quality: Reported earnings should clearly dis:nguish between transitory and permanent accoun:ng items: over :me the accoun:ng items should be based on iden:cal accoun:ng policies. If they change over :me, the change in a mrm"s performance might simply reqect changes in a mrm"s accoun:ng policies. Mul0ples: accoun:ng policies should be iden:cal across mrms o. Earnings in the comparable mrms should have the same quality .
