The Impact of Accounting and Financial Data Quality on Investment Decision-Making in the Economic Institution, with a Focus on Small and Medium-sized Enterprises (SMEs): A Field Study Using Statistical Methods

Abstract

This study aims to measure the effect of the quality of accounting and financial data and of financial analysis on investment decision-making in the Algerian economic institution. To achieve the study's objectives, the descriptive-analytical approach was adopted, whereby a questionnaire was designed as the main data-collection instrument and distributed to a sample of 45 Algerian economic institutions, predominantly small and medium-sized enterprises (SMEs) (public and private economic institutions). A set of statistical and analytical methods was used to test the study's hypotheses. Descriptive statistics showed that the level of agreement on the items of the three axes was moderate, without reaching a high level in any of them, while the correlation test revealed a positive and statistically significant relationship between financial data quality and the investment decision (r = 0.467), and a stronger relationship between financial analysis quality and the investment decision (r = 0.603). The multiple linear regression model also demonstrated its explanatory power, explaining 38% of the variance in investment-decision efficiency (F = 13.01, p < 0.05), and it was found that the quality of financial analysis is the strongest-effect variable in this model, surpassing the quality of the financial data itself.