Impact of IFRS adoption on reporting of firm efficiency: case of Indian IT firms Online publication date: Mon, 09-Apr-2018
by Sandhya Bhatia; Arindam Tripathy
International Journal of Accounting, Auditing and Performance Evaluation (IJAAPE), Vol. 14, No. 2/3, 2018
Abstract: This study examines the impact of the transition from generally accepted accounting principles of Indian jurisdiction (IGAAP) to international financial reporting standards (IFRS) on IT firms' reported performance efficiencies that are measured through different types of efficiencies of firms with the application of window analysis based on data envelopment analysis (DEA). We find that IT firms, in general, are found to operate on increasing returns to scale (IRS) indicating thereby cost diaspora in their advantage while raising the scale of production. Our statistical analysis also provides enough evidence that relative gross, technical and scale efficiencies of the firms remain relatively unchanged with a switching of accounting standards from IGAAP to IFRS. The semblance of impact on the reported relative performance efficiencies of the competing firms indicates the resemblances of accounting procedures that are being used under both standards in measuring the accounting amounts.
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