Corporate Transparency through Implementation of Indian Accounting standards

Abstract

Corporate transparency refers to removing barriers to and facilitating of free and easy public access to corporate information. Accounting standards are methodologies and disclosure requirements for the preparation and presentation of financial statements. Accounting standards are usually developed within the institutional and professional framework of a country, and promulgated by regulatory or professional accountancy bodies. Indian Accounting standards issued by Institute of Chartered Accountants of India are being harmonized with internationally recognized set of benchmark standards such as International Accounting Standards or the U.S. GAAP. The study is an empirical investigation on sample of listed companies to determine the extent of compliance with accounting standards leading to transparency in their financial statements. The paper is based on primary survey of Annual reports. Indian Accounting Standards mandatory for the listed companies are compared with disclosures made by the companies. The paper examines whether a significant relationship exists between disclosure in financial reporting and a number of key corporate characteristics like size, profitability, leverage, age of company etc. The collected data is being analyzed with Regression Analysis [OLS].Indian companies have shown high degree of compliance with disclosure requirements of Accounting Standards. Keywords: Corporate Transparency, Accounting Standards, Disclosures

View PDF