Describe the global financial markets and their relation to
financial reporting?

World markets are increasingly intertwined. With the integration of
capital markets, the automatic linkage between the location of the
company and the location of the capital market is loosening. As a result,
companies have expanded choices of where to raise capital, either equity
or debt. The move toward adoption of global accounting standards has
facilitated and will continue to facilitate this trend.
Financial statements and other means of financial reporting.
Companies most frequently provide (1) the statement of financial
position, (2) the income statement or statement of comprehensive
income, (3) the statement of cash flows, and (4) the statement of
changes in equity. Financial reporting other than financial statements
may take various forms. Examples include the president’s letter and
supplementary schedules in the company annual report, prospectuses,
reports filed with government agencies, news releases, management’s
forecasts, and descriptions of a company’s social or environmental
impact.
Efficient use of scarce resources. Accounting provides reliable,
relevant, and timely information to managers, investors, and creditors to
allow resource allocation to the most efficient enterprises. Accounting
also provides measurements of efficiency (profitability) and financial
soundness.
High-quality standards. A single, widely accepted set of high-quality
accounting standards is a necessity to ensure adequate comparability.
Investors are increasingly making investing decisions across
international jurisdictions. As a result, investors need financial
information that is comparable across national boundaries. But what are
high-quality accounting standards, how should they be developed, and
how should they be enforced is still a much debated issue.