Has the harmonisation of accounting practices improved? Evidence from South Asia

Abstract

Purpose – This paper aims to examine whether the level of harmonization of accounting measurement practices in three South Asian countries – Bangladesh, India and Pakistan – has improved since 1998 as a result of the changes, in recent years, globally in accounting measurement practices due to the substantial efforts of the International Accounting Standards Board (IASB). South Asian countries have taken a number of steps and made changes in accounting regulations to support the IASB’s harmonization programme. Design/methodology/approach – In all, 370 non-financial companies for the financial years 1997-1998 and 2007-2008 were used, and consistent with Ali et al. (2006), Van der Tas’s (1988) I index and Archer et al.’s (1995) modified C index were used to measure the extent of harmonization. Findings – It was found that the level of measurement harmonization has significantly improved over the years in selected South Asian countries. Originality/value – The results suggest that the harmonization of accounting will most likely ensure a greater level of transparency and uniformity in corporate reporting practices (measurement) in South Asian countries and throughout the world as promoted by the IASB.