Final answer:
The quality of financial reporting is enhanced through regulation compliance, external audits, and improved corporate governance. These efforts ensure accuracy, reliability, and transparency in financial statements for investors.
Step-by-step explanation:
The quality of financial reporting for publicly traded companies is improved through regulation compliance, such as adherence to standards set by organizations like the Financial Accounting Standards Board (FASB) and the Securities and Exchange Commission (SEC), as well as through external audits performed by independent auditors. These measures ensure that financial statements are accurate, reliable, and follow established accounting principles and regulations, which enhances transparency for investors. Furthermore, continuous improvements in corporate governance practices contribute to the quality of financial reporting by establishing clear roles and responsibilities for management and the board of directors, thereby promoting accountability and ethical behavior.