Identify the challenges that EMH brings to the traditional understanding of the role of accounting...

Question

Identify the challenges that EMH brings to the traditional understanding of the role of accounting information in the market. How does this affect the way in which accounting information is perceived by users? Summarize the contribution of positive accounting theory to accounting thought. HOW DIVERSE SHOULD BOARDS BE? Why is diversity under the spotlight?

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ECONOMICS
Table of Contents
Challenges that EMH brings to Traditional Understanding of Role of Accounting Information	3
Effect of EMH in Accounting Information	3
Positive Accountant Theory	3
How a Diverse Board should be?	4
Why is Diversity under Spotlight?	4
References	5
Challenges that EMH brings to Traditional Understanding of Role of Accounting Information
The challenges that efficient market hypothesis are facing while bringing to the traditional understanding of the role of accounting information in the market are, overconfidence, information biasness and representative biases. The efficient hypothesis market assumes that all investors perceive all available information in precisely the same manner and hence since the investor’s stocks differently, it becomes difficult to analyse and determine what stock should worth enough for any efficient market.
Hence, analysing the accurate stocks within a particular time phase becomes a challenging zone for this market where information and representative biasness plays a huge role. Apart from this, prices cannot determine the future stock performances and as a result, all of a sudden, the market cannot analyse,

Identify the challenges that EMH brings to the traditional understanding of the role of accounting information in the market. How does this affect the way in which accounting information is perceived...

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