scholarly journals A study of Effects and implications of differences between Indian GAAP and IFRS

2020 ◽  
Author(s):  
Anubha Srivastava
Keyword(s):  
Financial Reporting ◽  
Reporting System ◽  
Financial Burden ◽  
Accounting Standards ◽  
Financial Statement ◽  
Reporting Standards ◽  
High Quality ◽  
Accounting Standard ◽  
Financial Reporting Standards ◽  
Ifrs Adoption

Economic growth in any economy requires sustainable high-quality financial reporting standards. However in the era of globalization, with rapidly changing rules and regulations in accounting world, Indian financial reporting system too cannot be isolated from the global developments. Lack of standardization in different accounting standards imposes a financial burden on all the stakeholders, which includes both internal as well as external burden to an organization. It is also too cumbersome for investors to compare the financial statement of corporates if they follow different accounting policy. It was felt that there should be one global set of accounting standards for all. Thus IASB came in existence and formulated IFRS. IFRS is high-quality principle-based accounting standard which aims to bring uniformity comparability and transparency in accounting world. In India the conversion process has started in 2015-16 onwards where all the accounting standards will be gradually fully converged with IFRS and will be named as Ind as. This paper attempts to find out the key difference among IFRS, Indian GAAP and ind AS and its implications. A questionnaire survey has been conducted to find out the implication of differences. The paper concludes that adoption of IFRS would benefit the economy in all aspects. Keywords: IFRS, Indian GAAP, Ind AS, key difference between IFRS, Ind AS and Indian GAAP, IFRS adoption,

How Does Local Adoption of IFRS for Those Countries That Modified IFRS by Design, Impair Comparability with Countries That Have Not Adapted IFRS?

2017 ◽  
Vol 16 (3) ◽  
pp. 59-90 ◽  
Author(s):  
Elizabeth Felski
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
Financial Statement ◽  
International Accounting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Study Results ◽  
Reporting Environment ◽  
Proper Translation

ABSTRACT Global adoption of International Financial Reporting Standards (IFRS) is thought to increase financial statement reliability and comparability. Although IFRS is required or allowed in over 130 nations, some countries modify IFRS as issued by the International Accounting Standards Board (IASB). This study is designed to closely examine each country that modifies IFRS in an effort to determine whether these modifications impair financial statement comparability. First is that countries lack the resources to implement the newest version of IFRS or ensure proper translation of the standards. Second is that countries make specific changes to allow IFRS to better meet the needs of their financial reporting environment. I categorize the first set of countries as default countries and the second set as design countries. The study results in several interesting and useful contributions. First, I develop a new typology for future IFRS research that includes not only the locally adopted category, but also the default and design categories. Second, the details of how countries modify IFRS make it clear that differences can exist in financial statements prepared in different countries both using IFRS. The users must be careful to understand how comparability may be impacted by these modifications.

scholarly journals Divergence within IFRS adoption: the case of depreciation practices of listed banks in Bangladesh

2020 ◽  
Vol 10 (2) ◽  
pp. 169
Author(s):  
Mezbah Uddin Ahmed
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
National Standard ◽  
Accounting Standard ◽  
Pressure Groups ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Implementation Guidelines ◽  
Qualitative Characteristics

Comparability is one of the qualitative characteristics of financial statements that are prepared in compliance with the International Financial Reporting Standards (IFRS). The objective of this research is to identify whether this qualitative characteristic can be negated even when entities apply IFRS. In achieving the research objective, the depreciation policies adopted by the listed banks in Bangladesh are identified and compared with each other. This research finds that despite increasing effort by accounting standard setters and pressure groups to achieve IFRS-compliance and harmonization in accounting practices, non-compliance and divergence still exists. This research also finds that the divergence in depreciation practices can be of enough significance to negate comparability. The findings of this research expected to assist the international and national standard setters as well as the regulators in understanding the practical issues in implementing accounting standards and developing clearer IFRS implementation guidelines.

Adoption of International Financial Reporting Standards and the Changing Accounting Environment in Nigeria

2016 ◽  
pp. 1-26
Author(s):  
Abdulkadir Madawaki
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
International Financial Reporting Standards ◽  
Adoption Process ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Adoption Research ◽  
Accounting Environment

The purpose of this chapter is to examine the major differences between Nigerian financial reporting rules and International Financial Reporting Standards (IFRS) following Nigeria's accounting reporting convergence to IFRS. The chapter documented evidence of differences between Nigerian Statement of Accounting Standards (NSAS), Companies and Allied Matters Act, 1990, Nigerian tax rules and IFRS requirements. It also discusses the IFRS adoption process in Nigeria and the benefits Nigeria stand to gain in adopting IFRS. The chapter discusses the challenges that might be encountered in the process of adoption of IFRS in Nigeria. Finally, the chapter provides recommendations through which these challenges can be addressed and suggest ways for further IFRS adoption research in Nigeria.

Market Reaction to the Adoption of IFRS in Europe

2010 ◽  
Vol 85 (1) ◽  
pp. 31-61 ◽  
Author(s):  
Christopher S. Armstrong ◽  
Mary E. Barth ◽  
Alan D. Jagolinzer ◽  
Edward J. Riedl
Keyword(s):  
Information Asymmetry ◽  
Positive Reaction ◽  
Financial Reporting ◽  
Information Quality ◽  
Reporting Standards ◽  
High Quality ◽  
Market Reactions ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Stock Market Reactions

ABSTRACT: This study examines European stock market reactions to 16 events associated with the adoption of International Financial Reporting Standards (IFRS) in Europe. European IFRS adoption represented a major milestone toward financial reporting convergence yet spurred controversy reaching the highest levels of government. We find an incrementally positive reaction for firms with lower quality pre-adoption information, which is more pronounced for banks, and with higher pre-adoption information asymmetry, consistent with investors expecting net information quality benefits from IFRS adoption. We find an incrementally negative reaction for firms domiciled in code law countries, consistent with investors' concerns over enforcement of IFRS in those countries. Finally, we find a positive reaction to IFRS adoption events for firms with high-quality pre-adoption information, consistent with investors expecting net convergence benefits from IFRS adoption.

scholarly journals Convergence of IFRS and Ind AS – A Descriptive and Exploratory Insight

2021 ◽  
pp. 34-40
Author(s):  
Sayan Basu
Keyword(s):  
Advisory Committee ◽  
Financial Reporting ◽  
Accounting Standards ◽  
International Financial Reporting Standards ◽  
International Accounting ◽  
Reporting Standards ◽  
Accounting Standard ◽  
Financial Reporting Standards ◽  
International Accounting Standard ◽  
Financial Analyses

IFRS are designed to bring consistency to accounting language, practices and statements, and to help businesses and investors make educated financial analyses and decisions. The Ind AS are named and numbered in the same way as the corresponding International Financial Reporting Standards (IFRS). National Advisory Committee on Accounting Standards (NACAS) recommends these standards to the Ministry of Corporate Affairs (MCA). Indian viewpoints do not receive adequate attention at International Accounting Standard Board (IASB). Those are not debated adequately at the IASB before rejection. The present paper will discuss the reasons behind convergence of IFRs, rather than adoption. It also shows the Carve Outs of Ind AS from IFRS by providing valid reasons.

Financial statement comparability in the extractive industry

2020 ◽  
Vol 33 (3) ◽  
pp. 523-541
Author(s):  
Christelle Smith ◽  
Elmar R. Venter
Keyword(s):  
Financial Reporting ◽  
Mineral Resources ◽  
Financial Statements ◽  
Financial Statement ◽  
Accounting Standard ◽  
Extractive Industry ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Cross Country

Purpose This paper aims to investigate financial statement comparability in the extractive industry. This paper focuses on the extractive industry because International Financial Reporting Standards (IFRS) contain limited guidance on the accounting treatment for exploration and evaluation (E&E) costs and IFRS 6 – Exploration for and Evaluation of Mineral Resources allowed firms to continue with existing divergent accounting treatment of E&E costs. Design/methodology/approach The authors use data from Australia, a country that adopted IFRS in 2005 with a large extractive industry. They also compare changes in cross-country comparability around the IFRS adoption date between Australian firms and adopters relative to Australian firms and non-adopters to better isolate changes in comparability that are attributable to the adoption of IFRS from other sources that are not related to the adoption of IFRS. The authors measure comparability consistent with De Franco et al. (2011) where financial statements are comparable when two firms produce similar accounting amounts for similar economic events. Findings For non-extractive industry firms, the authors find the comparability of financial statements of Australian firms increased with other adopters and that this increase was relatively greater than the increase with non-adopter firms. This evidence is consistent with comparability benefits associated with the adoption of IFRS. However, for extractive industry firms, the authors do not find a significantly greater increase in the comparability of financial statements of Australian firms with adopters relative to the increase with non-adopters, suggesting that the increase is likely not associated with the adoption of IFRS. In additional analysis, they find that following IFRS adoption non-extractive Australian firms have greater within-country comparability relative to extractive Australian firms, while there was no difference in the pre-adoption period. Originality/value The evidence suggests that the divergent practices for E&E costs under IFRS 6 and the lack of an accounting standard that deals with matters relating to the extractive industry hinder the comparability of financial statements in this industry.

scholarly journals Konsep Nilai Wajar (Fair Value) dalam Standar Akuntansi Berbasis IFRS di Indonesia Apa dan Bagaimana?

2012 ◽  
Vol 3 (1) ◽  
pp. 93
Author(s):  
Heri Sukendar W.
Keyword(s):  
Financial Reporting ◽  
Banking Industry ◽  
Accounting Standards ◽  
Fair Value ◽  
Reporting Standards ◽  
Accounting Standard ◽  
Book Value ◽  
Financial Reporting Standards ◽  
The Difference ◽  
International Accounting Standard

This paper is intended to explain the use of the concept of fair value instead of book value. The accounting world in Indonesia during the last few years have made convergency implementation of new accounting standards oriented to the International Financial Reporting Standards (IFRS) issued by International Accounting Standard Boars (IASB). This new accounting standard that emphasizes the concept of fair value compared with book value concept is outdated. The use of the concept of fair value of the difference and it turned out to be a trigger konvergency change the paradigm of the book value of a simpler, but less information is less transparent. The implementation of accounting standards konverjensi done gradually raises serious problems, this can be seen from postponed the application of PSAK 50 & PSAK 55 in the banking industry. Knowledge and experience of inadequate is a priority of fair value implementation difficulties.

scholarly journals Accounting Standards and International Portfolio Holdings

2014 ◽  
Vol 89 (5) ◽  
pp. 1895-1930 ◽  
Author(s):  
Gwen Yu ◽  
Aida Sijamic Wahid
Keyword(s):  
Financial Reporting ◽  
Asset Allocation ◽  
Accounting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Portfolio Holdings ◽  
Ifrs Adoption ◽  
Mandatory Adoption ◽  
The Difference ◽  
Allocation Decisions

ABSTRACT Do differences in countries' accounting standards affect global investment decisions? We explore this question by examining how accounting distance, the difference in the accounting standards used in the investor's and the investee's countries, affects the asset allocation decisions of global mutual funds. We find that investors tend to underweight investees with greater accounting distance. Using the mandatory adoption of International Financial Reporting Standards (IFRS) as an event that changed the accounting standards of various country-pairs, we examine how two sources of changes in accounting distance—(1) changes due to IFRS adoption of the investee, and (2) changes due to IFRS adoption in the investor's country—affect global portfolio allocation decisions. We find that the tendency to underinvest in investees with greater accounting distance significantly weakens when accounting distance is reduced, either from an investee's IFRS adoption or from IFRS adoption in the investor's country. The latter finding holds despite the fact that IFRS adoption in the investor's country had no impact on the accounting standards under which the investee firms present their financial information; the only change is in the investor's familiarity with these standards. This suggests that differences in accounting standards affect investor demand by imposing greater information-processing costs on those less familiar with the reporting standards.

scholarly journals IFRS Adoption and Reporting Quality: An Assessment of User’s Perception in Nigeria

2021 ◽  
pp. 1-9
Author(s):  
Aminu Abdullahi ◽  
Hadiza Ahmed Suleiman
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Reporting Quality ◽  
Financial Statements ◽  
Financial Statement ◽  
Comparative Approach ◽  
Financial Reports ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Qualitative Characteristics

The study assessed the perception of financial statement users on the extent of reporting quality following IFRS adoption in Nigeria. A comparative approach was utilized, where users’ (investors)opinions on reporting quality between the Statement of Accounting Standards (SAS) regime and the International Financial Reporting Standards regime were sought and compared. The results obtained from the structured Likert scale questionnaires were analyzed using the T-Test. It was found that all the qualitative characteristics of financial reporting which were used as reporting quality variables in the study have improved with the adoption of IFRS except for the extent of the ability of financial reports to confirm or correct prior user’s expectation which was discovered to be better during SAS regime. It was recommended that the Financial Reporting Council of Nigeria (FRCN) should embark on advocacy aimed at educating investors’ especially, institutional on the issue of prediction and assessment of IFRS-based financial statements.

scholarly journals IFRS convergence: opportunities and challenges in India

2017 ◽  
Vol 1 (2) ◽  
pp. 13-18 ◽  
Author(s):  
Parvathy P. R.
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statement ◽  
International Accounting ◽  
International Accounting Standards ◽  
Accounting Standard ◽  
Financial Reporting Standards ◽  
The World ◽  
Global Language ◽  
International Boundaries

Past decade has witnessed several changes in the process of conduct of business activities across the world especially due to the wave of globalization. It has also made drastic changes in the process of financial reporting, in particular the continuing adoption of IFRS (International Financial Reporting Standards) worldwide. IFRS are high quality, understandable, enforceable and globally acceptable accounting standards issued by IASB (International Accounting Standard Board). Thus these are a set of international accounting standards stating how a particular type of transaction and other events should be reported in the financial statements. Thus IFRS are designed as a common global language for business affairs so that company accounts are understandable and comparable across international boundaries. IFRS is becoming the global language of business with over 40% of the world adopting this as their standard for reporting. India also decided to converge to IFRS from 1st April 2016 in a phased manner, which in turn improves the financial statement comparability and transparency that helps to attract greater cross border investments. This paper focuses on the convergence of IFRS with Indian Accounting Standards, its utility, issues and challenges faced by the stakeholders. It also throws light to the ways through which problems can be addressed.

Sign in / Sign up

Export Citation Format

Share Document