Precise data is the foundation of good risk management. Financial analysts use historical data to spot any potential risks and measure them against the organization. Inaccurate data can obscure real risks that would result in poor risk management and, consequently, unknown exposure to monetary losses. Data accuracy helps firms better predict potential problems and proactively manage risks before they arise.
Investor Confidence - Investor confidence in the accuracy of financial information pertaining to publicly traded companies determines the degree of investor confidence. Stakeholders expect such information to be transparent and reliable. Information that is in any way inaccurate or misleading may result in a downfall in stock prices and hurt reputations. Companies whose financial data are always found to be accurate attract and retain investors, and that influences their market standing positively.