The convergence of Indian accounting standards with the International Financial Reporting Standards (IFRS) is a clear indication that the accounting profession is going to raise the demand for the globalization of Indian business. However, convergence will consummate into superior financial reporting only with necessary changes in legislations, regulations and institutional reforms.

Business environment has undergone transformation from an industrialized economy to a technology-empowered, service-oriented and knowledge economy. As business activities are increasingly swept by the current of globalization, organizational structures are undergoing fundamental changes and information needs have taken new dimensions. Investor priorities are shifting from earnings to value, historical performance to sustainability and governance. Financial statements constitute the product of the complex accounting system that caters to the divergent and even conflicting interests of various parties such as management, shareholders, analysts, auditors, staff, creditors and regulators. Financial reporting has also evolved from an age of trust to an age of revelation in line with economic developments. This has caused traditional financial statements to lose relevance in terms of value to the various stakeholders.

The current trends experienced by the advanced countries of the West in reporting are value reporting, sustainability reporting, governance reporting and convergence of accounting standards with the IFRS. Value reporting focuses on including resources of the future that yield competitive advantage to the firm. They are supply contracts, patents and copyrights, license quotas, brands, technical know-how, workforce caliber, core competencies, etc. The financial reporting framework should give a detailed account of the financial position, risk profile, segmental analysis and the accounting policies to be followed. These new trends in reporting are gaining popularity and acceptance in many countries.

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