This study conducted for the nonfinancial sector of Pakistan, Total number of observations for the study is 600 with a group of 120. The dependent variable for this study is Capital structure and discretionary accrual, while independent variables include credit rating, profitability, and liquidity. The study developed two models for answering the research questions and objectives. Model one is about the impact of credit rating, profitability and liquidity on the capital structure, while model two is to examine the impact of credit rating and profitability on discretionary accrual. The results of the study show that credit rating and profitability positively impact capital structure and liquidity has a negative impact on capital structure. Moreover, in the second model, credit rating and profitability positively impact discretionary accrual. Another interesting finding from this study is that high rated firms more actively involved in asymmetry information. Due to this, in the financial market, investors invest in firms that increase the profitability of the firm.