Are Family firms in India managing their Earnings – An exploratory study

Abstract

“A House of cards” – is what Reliance Communications Ltd. has been described as by Veritas Investment Research, downgraded due to ‘whimsical’ accounting practices and questionable corporate governance norms1. “The last bastion falls” – is how Macquaire Equities Research titled its report in June 2012, downgrading HDFC to a rating of ‘underperform’ due to aggressive accounting practices related to inflated earnings and return on equity2. ‘A Crumbling Edifice’ on DLF and ‘A Pie in the Sky’ on Kingfisher Airlines were some of the other reports of Veritas during the year 2012, highlighting some irregularities in their financial reporting practices.