Assistant Professor, PG Department of Commerce, Rajdhani College, Bhubaneswar, Odisha, India
The Indian textile industry stands as one of the largest employers, rivaled only by agriculture. According to the National Handloom Census of 2019-20, this industry provides employment to over 35 million individuals within the country. In terms of value, it contributes 7% to the industrial output, 2% to India’s GDP, and accounts for 15% of the nation’s export earnings. Notably, the textile sector has played a pivotal role in the economy, not only by generating foreign exchange but also by contributing significantly to the GDP. At present, the cotton industry sustains the livelihoods of 5.8 million farmers, along with 40-50 million people engaged in ancillary activities such as processing and trading. Additionally, India holds the title of being the world’s largest jute producer. The sericulture and silk sector also play a substantial role: India ranks as the second largest silk producer, responsible for approximately 18% of global silk production. The country produces various types of silk, including Mulberry, Eri, Tasar, and Muga, constituting a labor-intensive sector. The primary objective of this paper is to examine and assess the value relevance of accounting information within selected textile companies in Odisha. The study is founded on secondary data collected from diverse sources like books, journals, websites, and newspapers. Through this research, it has been deduced that the textile industry in Odisha adheres to formal accounting practices, even in its largely unorganized structure. The analysis reveals that the overall financial performance of the textile companies remains moderate. This can be attributed to the substantial increase in raw material costs, influenced by demand-supply dynamics and, to some extent, directly linked to automobile sales.
Value relevance, Accounting information, Textile industry, Financial statement, Employability
