scholarly journals Presentation and Communication of Financial Information for Investment Decision: Synthesis of the Literature

2019 ◽  
pp. 67-79
Author(s):  
George Obeng
Keyword(s):  
Capital Structure ◽  
Market Orientation ◽  
Investment Decision ◽  
Financial Information ◽  
Corporate Failure ◽  
Complex Information ◽  
Proactive Market Orientation ◽  
Management Behaviour ◽  
Rational Investment ◽  
Management Choice

The focus of investment failure is seen as consequential to investors’ irrational decision. Capital structure and classical theories, by literature, informed the investor in making their portfolio choices. Currently behavioural finance positslack of cognitive and psychological capacity of the investor in the use of complex information to make a rational investment decision. The rationality of information, how presented and communicated by management is not on the radar of experts and analysts. Literature is reviewed, addressing the presentation and communication of financial information in proactive market orientation for rational investment decision.The studyposits the relevance of communicating financial information in proactive market orientation as againstthe linearone‐step modelapproach. Management should be responsible for any investment and corporate failure dependent on relevant financial information and how rationally communicated. Capital structure is a response of investors to management behaviour and not management choice.

scholarly journals Rationality of Information; How Embedded in Classical and Behavioural Theories in Investment Decisions

2019 ◽  
Vol 6 (9) ◽  
Author(s):  
George Obeng
Keyword(s):  
Capital Structure ◽  
Investment Decision ◽  
Investment Decisions ◽  
Investment Environment ◽  
Debt Capital ◽  
Self Interest ◽  
Rational Investment ◽  
Available Information ◽  
Behavioural Theories ◽  
The Capital Structure

Literature posits that investors are informed by the capital structure and other classical theories in making their portfolio choices, dependent on available information. The choice should be rational to conform to set models and rules in theories to achieve the best of reward from the investment. The issue of rationality has not been specifically addressed to help the assessment of information and the investment environment for decision making. The study reviews literature on the rationality of information in investment decisions corresponding to traditional and classical financial models. Attention is directed to the fact that investors react differently to available information and how interpreted. The reaction of investors to information being relevant or rational is adjunct to their expectation and self-interest. It is observed that rationality of information and its relevance should be the responsibility of management to ensure rational investment decision. With information asymmetry information is expensive and investors will trade of information for debt capital, which response establishes the capital structure. In emerging and underprivileged economies development of the bond market will help the less endowed to develop entrepreneurial capabilities.      

scholarly journals The impact of Key Audit Matters (KAMs) on financial information quality: Evidence from Lebanon

2021 ◽  
Vol 19 (2) ◽  
pp. 135
Author(s):  
Joelle Matta ◽  
Khalil Feghali
Keyword(s):  
Value Creation ◽  
Information Quality ◽  
Investment Decision ◽  
Financial Statements ◽  
Financial Information ◽  
Audit Report ◽  
External Auditors ◽  
Expectations Gap ◽  
Expectation Gap ◽  
The Impact

<p>The purpose of this study is to discover the impact of Key Audit Matters (KAMs) on financial information quality and their value for Lebanese auditors. The value creation of KAMs is determined by its financial information quality, its ability to help during investment decision and its effect on the audit expectation gap. The research is conducted through a survey that was filled by external auditors who audit Lebanese banks exclusively, and are involved in the new audit report. The main results show that reporting by using Key Audit Matters adds value to the audit report from the perspective of Lebanese external auditors, and can reduce information asymmetry, increase trust in accounting and reduce the expectation gap. Moreover, the results marked that KAM improves the auditee's understanding in the audited entity, builds confidence in the audited financial statements, and helps to reduce the audit expectations gap.</p>

scholarly journals The Determinan Kinerja Keuangan Perusahaan Pada Perusahaan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia

2021 ◽  
Vol 4 (2) ◽  
pp. 455-463
Author(s):  
Jusmarni Amir
Keyword(s):  
Capital Structure ◽  
Capital Market ◽  
Stock Price ◽  
Stock Exchange ◽  
Regression Method ◽  
Financial Information ◽  
Share Price ◽  
Linear Regression Method ◽  
Multiple Linear Regression Method ◽  
Food And Beverage

Stocks are currently a popular investment product among investors. Stocks that are of interest to investors are stocks that have a high selling value because the stock price is a very important factor to pay attention to and indicators are used to measure the welfare of shareholders. The higher the share price, the higher the value of the company and vice versa. However, investing in stocks in the capital market is also filled with an element of uncertainty or risk, this is because investors do not know with certainty the results they will get from their investments. Company specific financial information is one of the important internal company factors that can influence investors to invest. The research aims to analyse the effect of Capital Structure, liquidity, and profitability on stock price. Samples used in this study are food and beverage companies listed in the Indonesian Stock Exchange during 2016-2018 periods. Multiple linear regression method used to anlyse the effect of DER,CAR,  and NPM on Stock Price. The results showed that DER and CAR have not significant effect on Stock Price. NPM have a significant effect on Stock Price. Keywords: Capital Structure, liquidity, Profitability, Stock Price

scholarly journals Animal spirits: Keynes' theory of rational investment decision-making under conditions of fundamental uncertainty

2009 ◽  
Vol 52 (1) ◽  
pp. 17-44
Author(s):  
Ognjen Radonjic
Keyword(s):  
Decision Making ◽  
Economic Crisis ◽  
Investment Decision ◽  
The Other ◽  
Investment Activity ◽  
Animal Spirits ◽  
Investment Decision Making ◽  
Key Factor ◽  
Fundamental Uncertainty ◽  
Rational Investment

Keynes's term, animal spirits, has been mistakenly confused with irrational decision-making. However, if we accept Keynes' assumption that future is fundamentally uncertain and nonergodic, animal spirits become key factor that makes continual process of investment decision-making possible. On the other hand, if animal spirits blunt, investment activity dwindles and makes emergence of deep economic crisis likely.

Roles of strategic orientations in radical product innovation

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Chih-Wei Lin ◽  
Li Keng Cheng ◽  
Lei-Yu Wu
Keyword(s):  
Market Orientation ◽  
Entrepreneurial Orientation ◽  
Product Innovation ◽  
Life Cycles ◽  
Radical Product ◽  
Content Type ◽  
Proactive Market Orientation ◽  
Strategic Orientations ◽  
Market Feedback

PurposeBecause of relatively short product life cycles, radical product innovation has more significant influences on firms' competitive advantages in dynamic environments. Past studies identified various cultural characteristics of a firm, which are key drivers of developing radical product innovation on an ongoing basis. However, few studies have investigated the interaction between organizational culture and external market feedback in developing radical product innovation.Design/methodology/approachTo address the identified research gaps, this empirical research began by presenting conceptual foundations that lead to the hypothesized model and then analyzed survey data from 201 original equipment manufacturer suppliers in search of evidence supporting the hypotheses.FindingsThe results suggested that a supplier's entrepreneurial orientation and long-term orientation significantly and positively affected proactive market orientation, with proactive market orientation significantly and positively correlated with radical product innovation. The study confirmed that a proactive market orientation is essential in order for entrepreneurial orientation and long-term orientation to affect radical product innovation. Additionally, this study found that supplier–customer electronic integration has a moderating effect on proactive market orientation and radical product innovation.Originality/valueRadical product innovation is a topic of great interest for both academia and industry, yet a comprehensive conceptual framework for its antecedents is still lacking. To fill this theoretical gap, the present study extended the studies on radical product innovation and examined the relationship between different strategic orientation types in terms of supplier–customer strategic behaviors to determine how suppliers enhance radical product innovation.

Nonlinear and complementary effects of responsive and proactive market orientation on firms’ competitive advantage

2019 ◽  
Vol 32 (4) ◽  
pp. 841-859
Author(s):  
Fabian F. Osorio Tinoco ◽  
Miguel Hernández-Espallardo ◽  
Augusto Rodriguez-Orejuela
Keyword(s):  
Competitive Advantage ◽  
Market Orientation ◽  
Hierarchical Regression ◽  
Future Research ◽  
Manufacturing Companies ◽  
Positive Interaction ◽  
Cross Sectional ◽  
Content Type ◽  
Positive Effects ◽  
Proactive Market Orientation

Purpose The purpose of this paper is to clarify how responsive market orientation (RMO) and proactive market orientation (PMO) create competitive advantage. Design/methodology/approach Nonlinear and interaction effects are tested by applying hierarchical regression analysis to a sample of 272 Colombian manufacturing companies. Findings The results show that although market orientation promotes the competitive advantage of a business, both approaches – responsive and proactive – exhibit saturation effects and a positive interaction. Research limitations/implications The main limitation of this study is the cross-sectional design and the use of a single source for data collection. It is suggested that future research includes different orientations combined with these two market orientations – responsive and proactive – for achieving competitive advantage. In addition, further studies could replicate this analysis for different environmental conditions. Originality/value This paper simultaneously evaluates the nonlinear and complementary effects of RMO and PMO. From a strategic standpoint, it presents an empirical confirmation of the familiarity trap, the failure trap and the positive effects of combining RMO and PMO.

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