Abstract:The European Commission has required the adoption of IAS/IFRS in order to harmonize financial reporting standards for European listed companies as of 1 January 2005. Converting to IAS/IFRS has represented much more than a change in accounting rules, and firms' main concern has been to understand the extent to which accounting differences between national GAAP and IAS/IFRS could affect their reported performance. The purpose of the paper is to address this concern by providing empirical evidence of the nature and the size of the differences between Italian GAAP and IAS/IFRS. The total and individual differences between Italian accounting principles and IAS/IFRS are identified in the reconciliations of net income and shareholders' equity of Italian listed companies in order to show the major impacts of the conversion to IAS/IFRS. The findings indicate a more relevant total impact of such a transition on net income than shareholders' equity. The individual adjustments show a more significant discrepancy between the two set of standards in the accounting treatment of business combination, provisions, financial instruments and intangible assets with reference to both net income and shareholders' equity; while the individual accounting differences in income taxes, and property, plant, and equipment show a significant difference only on shareholders' equity.
In an era of change, restructuring and growing, business is becoming more competitive and demanding day by day. Utmost importance is given to profitability at every level and by all processes. If any business process or function is nonproductive or non-profitable, that is, non-core but necessary business processes, then the better strategic alternative is to outsource that process to a firm that specializes in that function, ensuring better economical performance. India, with its cost and time differential advantages, backed by an educated workforce, could commit quality of service. India is fast emerging as a preferred destination for outsourcing. Business process outsourcing (BPO)/information technology enabled service (ITES) is emerging as the next big opportunity for India after collapse of the dot com bubble and the economic slowdown. The present study is an attempt to elucidate the evolutionary cycle of outsourcing. A SWOT analysis has been carried out to evaluate India's competitiveness to meet global standards and thereby emerge as a preferred destination for outsourcing.
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