Title: Impact of IFRS adoption on reporting of firm efficiency: case of Indian IT firms

Authors: Sandhya Bhatia; Arindam Tripathy

Addresses: Indian Institute of Management Udaipur, Balicha, Udaipur-313001, India ' Milgard School of Business, University of Washington-Tacoma, 1900 Commerce Street, Tacoma, WA 98372, USA

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.

Keywords: international financial reporting standards; IFRS; Indian generally accepted accounting standards; IGAAP; data envelopment analysis; DEA; gross efficiency; technical efficiency; scale efficiency.

DOI: 10.1504/IJAAPE.2018.091061

International Journal of Accounting, Auditing and Performance Evaluation, 2018 Vol.14 No.2/3, pp.128 - 158

Received: 13 Dec 2016
Accepted: 17 Jul 2017

Published online: 09 Apr 2018 *

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