wts information asymmetry ?

If you have read the following paper, you should be able to sought out the problem yourself. I don't want to put everything on the post as you should be able to understand it yourself. Should you need further assistance, please let me know.
(1) Akerlof, "Market for Lemon"
(2) Spencer, "Job Signalling"
The four topics are inter-related. The major (4) principle-agent problem is caused by information asymmetry (agency theory). The information asymmetry will create two major problem, (1) adversed selection & (3) moral hazard (because the buyer parties cannot differentiate the good one to the bad one based on limited information). In order to sought out the information asymmetry, the parties with good quality will try to differentiate themselve from the bad quality by signalling. This is the major issue for agent theory and the reason for corporate governance.
(assume you are studying accounting) Financial statement is one of the tools to tackle the information asymmetry. The company (manager) deliver insider information to investor (outsider) so as to tackle the information asymmetry problem. Investor based on the information from financial statement can choose the best investment opportunities and to monitor the manager. The quality of the disclosure level can be used as a signal to "Signalling" the investor whether the company is a good one or bad one.
Another resources link for you to understand information asymmetry.
http://en.wikipedia.org/wiki/Principal-agent_problem