Informatics Publishing Limited

Nisha Kalra Chadda ¹, Shilpa Vardia ²

Affiliations
1 Institute of Commerce, Nirma University, Ahmedabad, Gujarat, IN
2 Department of Accountancy and Statistics, University College of Commerce and Management Studies, Mohanlal Sukhadia University Udaipur, Rajasthan, IN

Abstract

This paper tries to examine the degree of adaptability of the Fair Value concept, as codified in the International Financial Reporting Standards (IFRSs), in Indian Accounting Standards. Indian Accounting Standards are the official set of corporate financial reporting standards of India, a major emerging economy on the world map. Researchers examine whether and why companies preferred fair value to historical cost and what extent they choose between the two valuation methods. Except for property investment owned by real estate companies, historical price by far dominates fair value in practice. Indeed, proper value accounting is not mandatory for the plant, equipment, and intangible assets. The study includes the valuation methods for arguably the most controversial (non-financial) asset group: Property Plant and Equipment (PPE) and Property investment. For this, researchers have selected India’s top twenty real estate companies and examined companies’ incentives to choose fair value over historical cost by analyzing cross-sectional variation in valuation practices after IFRS adoption. In this research logistic regression model have been used to the probability that a given company will apply fair value as a function of company-specific characteristics. Researchers match each fair value of the company with historical cost companies, which are based on market capitalization in the stock market and the log of the market value of equity. It is found that companies using fair value accounting rely more on debt financing than companies that use historical cost. The evidence is consistent with companies using fair value to signal asset liquidation values to their creditors. It is not compatible with equity investors demanding fair value accounting for non-financial assets.

Keywords

Fair Value Accounting, IFRS, Historical Cost, Non-Financial Assets.

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Shilpa Vardia ¹, Ritu Soni ², Rimpi Saluja ²

Affiliations
1 Department of Accountancy and Statistics, Convener PGDIT University College of Commerce and Management Studies, Mohanlal Sukhadia University Udaipur, Rajasthan, IN
2 Department of Accountancy and Statistics, University College of Commerce and Management Studies, Mohanlal Sukhadia University Udaipur, Rajasthan, IN

Abstract

In the era of automation, the methods of recording and analysing business transactions are becoming automated, thus leading to the emergence of various disruptive technologies in the field of accounting. Robotic accounting is one such technology. The daily, repetitive data are automated using Bot software. In the present research, an attempt has been made to study the awareness about the use of robotic process automation (RPA) in accounting. The sample selected for the study consists of students, academicians, accountants, entrepreneurs, and auditors. The research analysed how this disruptive technology affects the work of accountants. Cronbach’s alpha test was applied to test the consistency of the items. Factor analysis was done to identify the factors that affect the use of robotics accounting. Factor analysis extracted three major components. The chi-square test was applied to measure the relationship between the respondents’ understanding of robotic process automation in accounting and their demographics. From the results, it can be inferred that the respondents’ understanding of robotic process automation in accounting differs significantly with respect to their gender, age, qualification, and profession.

Keywords

Robotics Accounting, Robotic Process Automation, RPA Software, Exploratory Factor Analysis, Chi-Square.

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