Effects of IFRS Adoption on the Financial Performance and Value of Listed Banks in Nigeria
Journal of Finance and Accounting
Volume 8, Issue 4, July 2020, Pages: 172-181
Received: May 8, 2020; Accepted: Jun. 2, 2020; Published: Jun. 23, 2020
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Author
Chuks Chikwendu Nwaogwugwu, Department of Accounting, Abia State University, Uturu, Nigeria
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Abstract
This study examined the effect of IFRS adoption on the financial performance and value of the listed banks in Nigeria. Using a sample of 5 banks,(8 years observation) that have adopted the international financial reporting standard (IFRS) from 2012 to 2015 and pre-IFRS period from 2008 to 2011, we can investigate performance and value of the listed banks. As the main objective of the study, we introduced panel data analysis on Return on Asset, Return on Equity and earnings per share (EPS) and IFRS dummy variable as the independent variables into the model. The paper uses the Fixed Effect Model as the appropriate estimator for analysis of the data. The estimated coefficient on the regime period (RR) term is statistically insignificant and positive in the models. The results suggest that the adoption of IFRS in Nigeria has not lead to higher performance and increased value. Overall, results suggest that the findings of this study are utmost important financial analyst, policy-makers and concerned stakeholder to ensuring that all firms adopt IFRS and create easy access for comparability. This will enable relevant and reliable financial information to be passed to the capital market for investors to take an informed and relevant decision
Keywords
Earnings, Value Relevance, IFRS, GAAP, Nigeria, Fixed Effect Model, Random Effect
To cite this article
Chuks Chikwendu Nwaogwugwu, Effects of IFRS Adoption on the Financial Performance and Value of Listed Banks in Nigeria, Journal of Finance and Accounting. Vol. 8, No. 4, 2020, pp. 172-181. doi: 10.11648/j.jfa.20200804.12
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Copyright © 2020 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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