Present Scenario of Credit Rating – To Confuse or Guide Investors

Abstract

We have conducted a study to know whether credit rating issued to the corporate guide the investors or to confuse them. In the past credit rating is a tool of value measurement. We have conducted a survey to know about the credit rating trustworthiness in present scenario. Companies are entering into agreements with few of the credit rating agencies and obtaining ratings.. The audit results are misrepresented sometimes. Mal practices in accounting are done by the companies in order to grab a better rating. So some of the investors are losing money in making a wrong selection of the potential company. These agencies must also ensure that proper and fair inspection of the company should be done by considering in the investor perspective. Credit raters must be ethical in order to increase the faith on the rating system.