Arguments against the regulation of accounting information include:
A) Mandated disclosures are cheap to provide and by their nature will devalue the worth of the information being provided.
B) By making so many choices of accounting methods available under the standards, the efficiency with which the information is provided will be enhanced.
C) Companies will be motivated to disclose good news but not disclose bad news if they are not forced to make certain mandated disclosures (the 'lemons' argument).
D) Managers of the organisation are in the best place to determine what information should be produced to increase the confidence of external stakeholders.

Question

Quizplus · Accepted Answer

Managers are believed to have the best understanding of their company's operations and are thus in the best position to decide what information is most relevant and beneficial for external stakeholders, arguing against the need for regulation.

Arguments Against the Regulation of Accounting Information Include