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- Title
Value-Based Accounting: A Performance Analysis of Indian Industry.
- Authors
Gupta, V. K.; Kumar, P. Venkata Vijay
- Abstract
Value-based accounting has significant impact on financial reporting of organizations. Value-based accounting distinguishes itself from traditional cost-based accounting by including the future outlook. This paper attempts to provide the present scenario of valuebased accounting with respect to Indian industries. It also attempts to apply the valueadded model in Indian industry to understand the relation of value addition with book value of net profits. It tries to measure the performance of organizations on the basis of different value-based accounting. Using the data of organizations included in the BSE 100 index for the year 2009, the paper identifies the contribution of variables belonging to income and expenses to value addition of the organization through regression analysis. It is found that Economic Value-Added (EVA) of Indian organizations is always lower than the accounting profit. However, most of the organizations in India have positive Market Value-Added (MVA). But the continuance of negative EVA in future would also result in negative MVA.
- Subjects
INDIA; MARK to market accounting; MARKET value added; FINANCIAL disclosure; BUSINESS enterprises
- Publication
IUP Journal of Accounting Research & Audit Practices, 2013, Vol 12, Issue 1, p7
- ISSN
0972-690X
- Publication type
Article