Financial Information and Investment Efficiency of Companies

  • Youness LAGZOULI Faculty of Law, Economics and Social Sciences of Souissi, Mohamed V University, Rabat, Morocco
  • Youness EL YAALAOUI Faculty of Law, Economics and Social Sciences of Souissi, Mohamed V University, Rabat, Morocco
  • Latifa LANKAOUI Faculty of Law, Economics and Social Sciences of Souissi, Mohamed V University, Rabat, Morocco

Abstract

The importance of financial information has been the subject of much debate, given its important role in the economy and its influence on corporate performance. This article is based on a systematic review, combining an in-depth analysis of existing theories and empirical studies to explore the impact of the quality of this information on the effectiveness of companies' investment decisions. The aim is to examine how high-quality financial information influences investment choices. The findings underline that transparency, reliability and accounting conservatism play a key role in reducing investment inefficiencies, both under- and over-investment. It is therefore essential to improve the quality of financial information in order to optimise company performance and maximise the creation of shareholder value. The study highlights theoretical frameworks such as the efficient market hypothesis, behavioural finance and asymmetric information, highlighting points of convergence, in particular the importance of transparency, and divergences, such as the varying effects of conservatism in different market contexts. The main theoretical gap identified lies in the nuanced understanding of the impact of the quality of financial information in emerging markets compared with developed markets. In addition, current research remains limited in exploring the interactions between advanced technologies and reporting standards, requiring further research.

 

Keyword: Financial information, Reliability, Investment efficiency, Financial market efficiency.

JEL Classification: G1, G14

Paper type: Theoretical Research

 

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Published
2025-02-02
How to Cite
LAGZOULI, Y., EL YAALAOUI, Y., & LANKAOUI, L. (2025). Financial Information and Investment Efficiency of Companies. International Journal of Accounting, Finance, Auditing, Management and Economics, 6(2), 255-273. https://doi.org/10.5281/zenodo.14788240
Section
Articles