Title: An empirical evaluation of financial reporting quality of the Indian GAAP and Indian accounting standards

Authors: Faozi A. Almaqtari; Najib H. Farhan; Eissa A. Al-Homaidi; Nandita Mishra

Addresses: Amity College of Commerce and Finance, Amity University, Sector 125, Noida, Uttar Pradesh, 201313, India ' Department of Accounting, Ibb University, Ibb, Yemen ' Department of Commerce, Aligarh Muslim University, Aligarh, 202001, UP, India ' Amity College of Commerce and Finance, Amity University, Sector 125, Noida, Uttar Pradesh, 201313, India

Abstract: The present study investigates financial reporting quality (FRQ) of Indian GAAP and Ind. AS. The study uses data of 450 companies listed on the Bombay Stock Exchange (BSE) over the period from 2011 up to 2016. This study is motivated by adoption of Ind. AS by listed companies that have net worth of 500 crores or more, which implemented in 2016. It examines FRQ pre- and post-conversion to Ind. AS. Descriptive statistics, correlation, and regression models are used to estimate the results. Further, paired sample t-test of residual values of regression models is used to evaluate FRQ of Indian GAAP and Ind. AS. The results indicate a significant difference of FRQ between Indian GAAP and Ind. AS. The findings reveal that adoption of Ind. AS has improved FRQ of financial statements. The study contributes to Ind. AS literature by establishing empirical evidence of FRQ of accounting standards, which has not been provided and investigated by prior studies.

Keywords: FRQ; financial reporting quality; Ind. AS; Indian GAAP; IFRS; International Financial Reporting Standards; total accrual; annual stock returns.

DOI: 10.1504/IJAAPE.2020.112717

International Journal of Accounting, Auditing and Performance Evaluation, 2020 Vol.16 No.2/3, pp.200 - 229

Accepted: 02 Apr 2020
Published online: 01 Feb 2021 *

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