Some recent capital markets research investigates whether accounting information reflects the valuations that have already been made

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Some recent capital markets research investigates whether accounting information reflects the valuations that have already been made by the market

(as reflected in share prices). In a sense, it assumes that the market has it ‘right’ and that a ‘good’ financial accounting approach is one that provides accounting numbers that relate to, or confirm, the market prices/returns. If we assume that the market has it ‘right’, what exactly is the role of financial accounting?

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Financial Accounting Theory

ISBN: 9780071013147

4th Edition

Authors: Craig Deegan, H. Bierman

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