Abstract
PurposeThe mandatory adoption/convergence of IFRS has increased the information quality of reported earnings in equity markets across the globe. The purpose of the study is to explore whether the mandatory convergence of Indian Accounting Standards (Ind AS) with International Financial Reporting Standards (IFRS) affect the financial reporting quality of listed firms in India.Design/methodology/approachThe sample includes 355 non-financial publicly listed firms on National Stock Exchange (NSE) of India with 1,065 firm-year observations. The authors use models similar to Jones (1991), and DeFond and Jiambalvo (1994) to investigate value relevance in the period “1st January 2017 to 31st December 2019”. The study uses the quantile regression (QR) analysis to verify our hypothesis.FindingsThe findings suggest that IFRS convergence process adds value to accounting quality of reported earnings in Indian stock market. The authors' QR estimations produce collaborating evidence on the uneven impact of IFRS across quantiles and the financial reporting quality skewed in favour of investors of high-valued firms.Research limitations/implicationsThe effects of convergence with IFRS in value relevance of financial statements could be reinforced by considering alternate accrual models and incorporating more accounting measures on an expanded sample of stocks from several global markets.Practical implicationsPresently, convergence of local accounting standards to IFRS in India is only partial. The findings may produce useful insights for regulators and standard setters to further increase the value relevance of financial reports whilst they move towards full convergence.Originality/valueThe study explores the information quality of reported earnings of Indian listed firms in post-IFRS convergence period, which is not properly investigated in the literature. Moreover, the research is unique in terms of applying QR estimations to examine the value relevance of IFRS-converged financial reporting from the emerging market perspective.
Reference120 articles.
1. Robust regression quantiles;Journal of Statistical Planning and Inference,2004
2. The value relevance of IFRS in the European banking industry;Review of Quantitative Finance and Accounting,2011
3. Impact of firm size on earnings management: a study of textile sector of Pakistan;European Journal of Business and Management,2015
4. Applied Econometrics
5. Value versus growth stock returns and the value premium: the Canadian experience 1985–2005;Canadian Journal of Administrative Sciences,2009
Cited by
5 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献