Accounting Diversity and Firms’ Value: A Comparative Study of Ind AS & IGAAP
Himanshu Agarwall*(Research Scholar, P. G. Department of Commerce, Utkal University, Bhubaneswar, Odisha, India), Chandrika Prasad Das (Assistant Professor, Khallikote University, Berhampur, Odisha, India) and Rabindra Kumar Swain(Assistant Professor, P. G. Department of Commerce, Utkal University, Bhubaneswar, Odisha, India) *Corresponding author's Email
Agarwall, Himanshu; Das, Chandrika Prasad and Swain, Rabindra Kumar (2019), “Accounting Diversity and Firms’ Value: A Comparative Study of Ind AS & IGAAP”, MERC Global’s International Journal of Management, Vol. 7, Special Issue 1, pp. 55-61.
Submitted: February 17, 2019, Revision received: March 20, 2019, Accepted: April 01, 2019
Diverse accounting practices for business reporting across the globe results in non-comparability, lack of transparency, lack of understandability, lack of relevance and lack of reliability of accounting information. Due to increasing cross border business, and the global capital market, it has become imperative to have a single understandable accounting reporting language. In view of the above fact, more than 120 countries have already adopted IFRS. India, though, has not adopted IFRS, but have converged Indian standards with IFRS in the form of Ind AS. Our research aims to study the impact of the adoption of Ind AS over the Net Worth and Total Assets of Indian manufacturing companies from 3 perspectives, i.e., Depreciation (Ind AS 16), Revenue (Ind AS 115) and Profitability as a whole. Authors have taken the top 37 manufacturing companies as per market capitalization and used a Regression model to measure the impact. It is inferred from the test result that adoption of Ind AS significantly influences the Net Worth & Total Assets of companies from Depreciation, Revenue and Profitability perspective. However, the adoption of Ind AS doesn’t have an impact on the Total Assets of the companies from the Revenue perspective.
Ind AS, Depreciation, Revenue, Profitability, Net worth, Total Assets.
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