Munich Personal RePEc Archive

Corporate Governance and Accounting Practices in Pakistan

Ali, Syed Babar (2012): Corporate Governance and Accounting Practices in Pakistan. Published in: International Journal of Advanced Research No. 5 (May 2015): pp. 192-211.

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Abstract

Providing transparency in terms of financial accounting information is one of the objectives of corporate governance. Good accounting practices would result in accounting information that would be very useful to the stakeholders, hence good governance. Employment of effective accounting standards, such as IFRSs can be considered as a better accounting practice that are claimed to produce better disclosure and comparability of accounting information. This study was made to determine whether the companies listed in Pakistan complied with the requirements of IFRS, and whether the financial statements of those companies were harmonized. Thorough document analysis of the selected 51 companies was performed for the selected IFRSs. To determine the degree of harmonization of accounting practices among the companies in Pakistan C index was used. To test for the level of harmonization Chi square test was used. We concluded that, across the board, companies in Pakistan pursue and comply with the requirements of International financial reporting standards (IFRS). This is not the same for the degree of harmonization. Although for most of the IFRS selected degree of harmonization was positively tested there were a few exceptions. The implication is that the users of financial statements should first make adjustments for these items and then compare any aspect of financial condition or performances of the companies in Pakista - See more at: http://www.journalijar.com/article/4503/corporate-governance-and-accounting-practices-in-pakistan/#sthash.9ovp4lAu.dpuf

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