Resource title

The role of accounting in the German financial system

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Resource description

This chapter analyzes the role of financial accounting in the German financial system. It starts from the common perception that German accounting is rather uninformative . This characterization is appropriate from the perspective of an arm s length or outside investor and when confined to the financial statements per se. But it is no longer accurate when a broader perspective is adopted. The German accounting system exhibits several arrangements that privately communicate information to insiders, notably the supervisory board. Due to these features, the key financing and contracting parties seem reasonably well informed. The same cannot be said about outside investors relying primarily on public disclosure. A descriptive analysis of the main elements of the Germany system and a survey of extant empirical accounting research generally support these arguments.

Resource author

Christian Leuz, Jens W├╝stemann

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25392

Resource license

Adapt according to the presented license agreement and reference the original author.