Transition of Ind AS and Its Impact on Profitability of Indian ‎Companies

  • Authors

    • Sandhiya Priya Pitchandi Research Scholar, Department of Commerce, Vellore Institute of Technology, Vellore
    • Muthumeenakshi Muralikrishna Associate Professor, Department of Commerce, Vellore Institute of Technology, Vellore
    https://doi.org/10.14419/akkjet93

    Received date: June 30, 2025

    Accepted date: August 8, 2025

    Published date: October 2, 2025

  • Financial Reporting; Gray’s comparability Index; IFRS; IGAAP; Ind AS; Ratios

  • Abstract

    High-quality uniform standards are essential for competing in the global market, particularly in accounting and auditing. The Indian ‎Accounting Standards (Ind AS) represent a significant shift for Indian companies, transitioning from the traditional Indian Generally Accepted ‎Accounting Principles (IGAAP) to a more comprehensive framework aligned with International Financial Reporting Standards (IFRS). ‎This important transition began in 2016, allowing Indian companies to gradually adopt these modern standards. The Ministry of Corporate ‎Affairs (MCA) introduced a well-structured roadmap for this adoption, divided into four distinct phases based on the company's net worth. ‎This approach ensures a smooth and strategic transition to higher accounting standards. In the first two years after adoption, listed and non-‎listed Indian companies are categorized, while Listed Non-Banking Financial Companies (NBFCs) and non-listed NBFCs fall under the ‎third and fourth years of adoption. The proposed study is carried out with the help of annual reports of 13 companies to examine the impact of ‎the implementation of Ind AS using select ratios with Gray’s Comparability Index Measure and Paired sample t test. The study concluded that ‎there are changes and an impact of implementation on profitability and liquidity on implication of Ind AS in companies, but solvency remains ‎the same as in IGAAP‎.

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  • How to Cite

    Pitchandi , S. P. ., & Muralikrishna , M. . (2025). Transition of Ind AS and Its Impact on Profitability of Indian ‎Companies. International Journal of Accounting and Economics Studies, 12(6), 18-23. https://doi.org/10.14419/akkjet93