Author(s): Nidhish Kumar Mishra, Ijaz Ali, Ashraf Imam, Asma Khatoon, Odunayo Magret Olarewaju, Imran Ahmad Khan & Asif Baig,
In line with the idea of "transaction cost economics," which views markets and organizations as alternative mechanisms for resource allocation, the "numerical signal perspective" refers to our view of the function of accounting in which, in contrast to market prices, which are the typical information medium for resource allocation (i.e., numerical signals), accounting figures (especially accounting profits) produced by the accounting system act as an information medium for coordinating business-related transactions in a way that complements or replaces market prices. The purpose of this paper is to explore a model with desirable features and attributes that are compatible with the development of an analytical model of this "number signal perspective" for analytical research. Therefore, this paper reviews and summarizes the past results of disclosure models in the field of financial accounting, borrowing from the discussion in Verrecchia (2001) and Stocken (2012), which are survey papers on accounting disclosure models. One of the conclusions of this paper is that a "noisy rational expectations type model" that incorporates a certain discretionary nature of accounting information and maintains its concreteness, or a "signal-jamming model" with a certain endogenization of capital market processes, is desirable for the "numerical signal perspective".