Date of Publication :21st December 2017

Abstract: The long felt need for unification of accounting language across countries has lead to the propagation of IFRS including IAS. Convergence of the accounting language followed at local or regional level with that of the IFRS has many advantages such as increased access to global capital, harmonization of accounting practices across nations, reaching out to global investors, taking informed decision, mobilising global resources and professionalization of accounting education the world over. Leading economies of the world have volunteered to be the pioneer in embracing the IFRS either through adoption or through convergence. India is one among the pioneers in doing so with its large companies classified as those having a net worth of Rs. 1000 crore (i.e, $ 224.27 million USD) or more mandated to adopt IFRS with effect from April 1, 2011. This was to be followed by companies with net worth of Rs. 500 crore (i.e, $ 82.63 million USD ) or more, from April 1, 2016 and the companies with Rs. 250 crore (i.e, $ 38.31 million USD) or more from April 1, 2017. The rest of the companies are to adopt IFRS voluntarily. Adoption of IFRS is beneficial to every kind of business, large, medium or small including the micro enterprises. The SMALL CAPs (Small Capitalisation companies) in India too are to benefit from IFRS. This paper examines the nature and extent to which SMALL CAPs, i.e, companies with net worth between $ 15.4 million to $ 37.5 million have adopted the IFRS in India and to determine the factors which influence adoption of IFRS by the SMALL CAPs on a voluntary basis. Research problem The BSE listed SMALL CAP companies for being considered as companies having less resources may have constraints in adopting and implementing IFRS even though implementation of IFRS is advantageous to them. It is therefore considered prudent to ask questions as to 1. The extent to which SMALL CAPs have accepted and implemented IFRS; 2. The nature, extent and dimension of such implementation; and 3. The factors which primarily drive SMALL CAPs to adopt and implement IFRS. Aim of the study: This paper (1) Examines the nature and extent to which SMALL CAPs in India have adopted the IFRS; and (2) Determines the factors which influence adoption of IFRS by the SMALL CAPs on voluntary basis. Research and methodology: • Data Source and method of data collection: The study is based mainly on analysis of primary data collected through own developed questionnaire in a 5-point likert scale. The questionnaire consists of 30 statements distributed among 216 respondents of 80 selected SMALL CAPs. The respondents include chartered accountants, cost accountants, company secretaries, senior managers, and policy makers associated with SMALL CAPs, selected at random. • Data Analysis: Factor analysis has been conducted on the collected data by using SPSS 22.00 to identify the influencing factors for voluntary adoption of IFRS by SMALL CAPs. Important findings The study reveals that voluntary adoption of IFRS by SMALL CAPs in India is influenced by three major factors, namely, FDI inflows, FDI inflows, unification of reporting, Reporting durability and reporting cost. Originality/Contribution The study is original and empirical in nature. It is based on data collected through structured questionnaire. The perception of the preparers and analysts of accounting reports of selected SMALL Cap companies in India keeping in view the changing paradigm of the accounting principles has been analysed in the study.

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