ACCOUNTING

Accounting



Accounting

In this paper, we are contrasting two journals of accounting the first one is the relation between the return and earnings and second is accounting and organizational culture.

First Journal

The relation between returns and earnings: evidence for the UK

At first we will discuss the relation, between the stock return and earnings for this purpose we have selected 477 companies with 10 years of proven accounting record. Overall variation can be observed when there is a change in share price, means earnings sometime also affect share price resulting in differing returns, and this return sometime associated with different types of risk, means we cannot avoid risk factor here. Assessment of risk and profitability of the investment portfolio is one of the major challenges facing the management company at all stages of investment. Typically, the investment portfolio consists of various securities, which have different levels of profitability and risk.

Risk and return of the investment portfolio based on tasks which are an investor. In case the investor creates a portfolio of forceful persuasion, than the risk and yields securities, which are like an investment portfolio, are quite high, normally "aggressive" portfolio consists of stocks of young growth companies. Conservative portfolio characterized by poor risk, and low-income securities, usually in a "conservative" portfolio consists of securities of large companies, which produce a small but guaranteed return.

Most investors prefer to have a balanced set of securities, risk and profitability of the investment portfolio in this case is approximately equal, which allows you to have a stable income due to balance between risks and returns of various types of securities. The strategy of forming portfolios, buying and selling securities, corporate managers must evaluate the level of risk and return portfolio. To assess the risk and profitability of the investment portfolio should be carried out multivariate analysis, which may be based on different mathematical models. Often to assess the risk and profitability of the investment portfolio using specialized software (Strong 1993, 69).

Evaluation of profitability of the securities produced by a straightforward formula: the value of the securities at the time of the calculation must subtract the value of the securities at the time of purchase, and the difference divided by the value of the securities at the time of purchase. Assessment of risk of securities is a complicated process. The market conditions are constantly changing, often on the rise or fall in value of securities influenced by such factors, which may not always be taken into account even the most efficient mathematical models. Portfolio risk measured not only in the form of total risk for each security, but also the risk that may arise due to the effects price of one type of securities, the value of other types of securities. As a rule, the overall risk of the investment portfolio consists of a systematic and diversifies risk, which may depend on various parameters.

Second Journal

Accounting and organizational cultures

Accounting practices are a common feature of most forms of work organization: planning activities and budget systems, command responsibility, procedures, ...