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Efficient Capital Markets - Financial Reporting

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What is the role of honesty, transparency, and accountability in institutional financial reporting? Why is providing legal and ethical fiscal reporting to stakeholders important?

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Solution Summary

A discussion of the purpose of the concept of efficient capital markets and their usefulness in making investment decisions. The solution is 414 words total. The role of honesty, transparency, and accountability in institutional financial reporting is provided.

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One of the fundamental principles of finance is efficient capital markets, which states that information regarding any publicly traded firm is readily available to any interested party. As such, the idea is that a firm will be honest in all of its transactional reporting, as well as its future plans and strategies; will provide transparency in all of its dealings not only with stakeholders, but also with the financial community and the local community in which it operates; and will be held fully responsible for all of its dealings within the economic and financial market places. The basic assumption for this is that if you and I are ...

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