Financial Performance of Glaxo Smith Kline after Adoption of IFRS

Abstract

International Financial Reporting Standards (IFRS) explains about transparency and certainty in international financial markets.It also brings high quality, efficiency and accountability to financial markets across the globe.The major objective of thepaper is to identify statistically significant differences found in financial ratios derived from financial statements based on IFRS standards of Glaxo smith Kline inclusive of  items appearing in Balance sheet and Income statement. The analysis is based on Glaxo smith Kline, an Indian company that have adopted IFRS reporting. Financial statements prepared as per IFRS standards was taken  for a period of three years.The categories of Financial ratios such as Liquidity, Leverage, profitability, and Efficiency were analysed using the following tests. The tests include Descriptive statistics, Shapiro-Wilk and Kolmogorov-Smirnov normality test,Wilcoxon’s signed ranks test, and linear regression analysis.The results identified that there were significant differences between financial ratios based on IFRS, the study resulted that IFRS adoption has led to a statistically significant results in Liquidity, Leverage, profitability and Efficiency ratios.