Accounting for Risk

preview-18
  • Accounting for Risk Book Detail

  • Author : Stephen Penman
  • Release Date : 2021-11-11
  • Publisher :
  • Genre :
  • Pages : 148
  • ISBN 13 : 9781680838909
  • File Size : 73,73 MB

Accounting for Risk by Stephen Penman PDF Summary

Book Description: Accounting for Risk is about using accounting information to assess risk and the required return for bearing that risk. The focus is on investing in firms and the equity claims on firms: How much should an investor discount the price of a share in a firm for risk, and how can accounting information help to answer that question? That discount is variously called the required return, the expected return, or the cost of capital. The monograph links two strands of research - the first is accounting-based valuation research where value is assessed from expected cash flows, earnings, or residual earnings. The focus has been on forecasting those payoffs however forecasting payoffs is only one part of valuation. The other issue is how those expected payoffs should be discounted for risk. This monograph engages the question whether accounting information aid in the determination of risk and the discount rate? The second strand of research is asset pricing. While "asset pricing" might suggest this research is involved in determining prices, it is actually in pursuit of the required return to investing - the risk discount to price. Can accounting information about risk and return be utilized in building operational pricing models? Accounting for Risk also enhances financial statement analysis. While traditional financial statement analysis--ratio analysis--was conducted without much reference to finance theory, modern financial statement analysis derives from accounting-based valuation models that are based on the no-arbitrage theory on the pricing of expected dividends. That brings accounting and finance closer together. The key is an understanding of the accounting principles underlying the recognition and measurement in the financial statements. This requires an appreciation of how accounting handles risk, thereby generating accounting numbers that convey information about risk and expected return.

Disclaimer: www.yourbookbest.com does not own Accounting for Risk books pdf, neither created or scanned. We just provide the link that is already available on the internet, public domain and in Google Drive. If any way it violates the law or has any issues, then kindly mail us via contact us page to request the removal of the link.

Accounting for Risk

Accounting for Risk

File Size : 94,94 MB
Total View : 8960 Views
DOWNLOAD

Accounting for Risk is about using accounting information to assess risk and the required return for bearing that risk. The focus is on investing in firms and t

Hidden Financial Risk

Hidden Financial Risk

File Size : 40,40 MB
Total View : 9967 Views
DOWNLOAD

An insider's guide to understanding and eliminating accounting fraud How do these high-profile accounting scandals occur and what could have been done to preven

Accounting for Financial Instruments

Accounting for Financial Instruments

File Size : 82,82 MB
Total View : 9369 Views
DOWNLOAD

Accounting for Financial Instruments is about the accounting and regulatory framework associated with the acquisition and disposal of financial instruments; how