Disclosure of Cost Formulae Used in Valuation of Finished Goods Inventory in Indian Manufacturing Industry

Shurveer S Bhanawat and Abhay Jaroli

The IUP Journal of Accounting Research and Audit Practices, 2013, vol. XII, issue 3, 19-27

Abstract: A proper disclosure of valuation of finished goods inventory is required for consistent and accurate financial statements. Accounting Standard (AS)-2 is specifically devised for this purpose. This paper makes an attempt to compare the actual prevailing practices of disclosure of cost formulae in the Indian manufacturing industry and disclosure requirement of methods of cost formulae suggested in the AS-2. It is found that only capital goods industrial sector followed 100% disclosure throughout the study period, while lower disclosure was observed in automobiles. The study clearly indicates that there is no significant difference among different sectors of the Indian manufacturing industry regarding different methods of valuation of cost formulae used in finished goods inventory.

Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:icf:icfjar:v:12:y:2013:i:3:p:19-27

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