Indian Institute of Management Bangalore

About: Indian Institute of Management Bangalore is a education organization based out in Bengaluru, Karnataka, India. It is known for research contribution in the topics: Emerging markets & Context (language use). The organization has 491 authors who have published 1254 publications receiving 23853 citations. The organization is also known as: IIMB.

Voluntary US GAAP Disclosure in India: The Case of Infosys Technologies Limited

Abstract: This paper describes the impact of economic liberalisation in India on financial reporting. It explains the role of internationalisation of business on financial reporting by firms. Infosys Technologies Limited, a leading Indian software company with extensive international operations, has recently provided supplementary unaudited US GAAP financial statements in addition to the financial statements required under Indian company law. The paper presents a case study of this company to illustrate the incentives for voluntary non-domestic GAAP financial statements in corporate reports.

Accounting for Sovereign Risk When Investing in Emerging Markets

Abstract: In theory, political risk is project-specific and should be accounted for in the estimation of the expected investment cash flows. But in practice, the political risk associated with this type of investment is typically accounted for implicitly by adjusting the investment's required rate of return or the discount rate. As the authors discuss in the article, this approach disguises the specific assumptions being made about the risk of expropriation and so makes it difficult to assess this risk properly. While defending some aspects of current practice, the authors argue that corporate executives should consider some changes. For example, although a project analysis that is shared with the host government could incorporate a risk adjustment to the discount rate, the authors suggest that more explicit analysis of the anticipated risk of expropriation should be incorporated into the analysis of expected project cash flows. This analysis could involve making specific assumptions about the “term structure” of expropriation risk over the life of the investment. Finally, the authors note that the political risk of making investments in emerging economies can be managed to some extent. Investments can be structured in ways that reduce political risk by structuring project cash flows in ways that better align the incentives of the project sponsor and the government of the host country.

The existence and persistence of household financial hardship: A Bayesian multivariate dynamic logit framework.

Abstract: We investigate the existence and persistence of financial hardship at the household level using data from the British Household Panel Survey. Our modelling strategy makes three important contributions to the existing literature on household finances. Firstly, we model nine different types of household financial problems within a joint framework, allowing for correlation in the random effects across the nine equations. Secondly, we develop a dynamic framework in order to model the persistence of financial problems over time by extending our multi-equation framework to allow the presence or otherwise of different types of financial problems in the previous time period to influence the probability that the household currently experiences such problems. Our third contribution relates to the possibility that experiencing financial problems may be correlated with sample attrition. We model missing observations in the panel in order to allow for such attrition. Our modelling framework allows us to identify any persistence in financial problems over time as well as any interdependence that may exist between different types of financial problems. Our findings reveal interesting variations in the determinants of experiencing different types of financial problems including demographic and regional differences. Our findings also highlight persistence in experiencing financial problems over time as well as the role that saving on a regular basis can play in mitigating current financial problems.