Value relevance of accounting information: A case of Karachi stock exchange listed companies in Pakistan

摘要

As one of the basic components of economic growth and development in every country, the capital market is responsible for optimal allocation of capital. For the correct guidance of the decisions along the optimal allocation of capital, information has a main role and financial reports are of the most important information resources. So, in the present study, effort is on studying the effect of competition in the company’s product market on the quality of financial reporting. Thus, the cash operational flow expected for evaluating the financial reporting quality is used. In this regard, 125 companies have been studied by applying the conditions (elimination method) in Tehran Stock Exchange during 2001 to 2008. For the hypothesis test, the correlation coefficient and the linear regression test methods have been used with the help of SPSS. Results show that there is an inverse relation between the competition in the company’s product market and the quality of the financial reporting.