Segment Reporting Practices in Indian IT Companies

Raju L Hyderabad and P B Kalyanshetti

The IUP Journal of Accounting Research and Audit Practices, 2011, vol. X, issue 3, 25-45

Abstract: A firm reporting by segments leaves more information in the hands of stakeholders and helps to improve the quality of decisions undertaken by them. AS-17 in India mandates listed and other companies to report information by segments. The present paper analyzes such segmental reporting practices of IT companies in view of their changing customer profile and geographical existence. The study finds the Indian IT companies to identify a few segments and business segment is the primary segment. Multiple-listed companies identify more segments than single stock exchange listed companies and revenue is the basic criteria used for identifying reportable segments. The sample firms score poorly in disclosing both mandatory and voluntary information. Profitability, listing status, external shareholding and proportion of independent directors positively affect the reporting practices of IT companies in India, while size of the firms affects negatively.

Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:icf:icfjar:v:10:y:2011:i:3:p:25-45

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