Evolution in value relevance of accounting information post IFRS convergence in India

Abstract

This project study examines the value relevance of accounting information after IFRS adoption in India and identifies reasons for the same. Value relevance is often linked to the reliability and relevance of accounting information. IFRS, on the other hand, is attributed to improve the quality of financial information – on account of regulatory disclosures in a country and enhanced comparability of financial information as more and more countries converge to IFRS standards. The results from this study show that value relevance of the information has improved, as characterised by Earnings Response Coefficients (ERCs), after mandatory IFRS adoption in Indian firms.