Abstract

Investment decisions are very critical and are of major importance to the investors because they involve the risk of loss of money. These investment decisions are made by the investors by using the financial information presented by the financial reports of the companies they are interested to invest in. So the quality of financial reporting has to be up to the mark so that the investors can make fruitful investment decisions. The major objective of this report was to find out the significant effect of financial reporting and the importance of ratio analysis on the investors’ decision making and also to find out the importance of implementing internal control to improve the quality of financial reporting. The data were collected from primary sources through questionnaire and personal interview method. The major findings of the study involved the investors’ perspective towards the importance of the quality of financial reporting and ratio analysis while they make investment decisions and also how the investors believe that the implementation of Internal Control over Financial Reporting will improve the quality of financial reporting and make the financial information more reliable to them when they make investment decisions.