Convergence of Accounting Standards and Financial Reporting Quality of Brewery Industry in Nigeria

Onodi, B.E., Nwaorgu, I. A., Edibo, S. J. & Abiahu, M. C. (2018). Proceedings of 4th Annual International Academic Conference on Accounting and Finance.

21 Pages Posted: 29 Aug 2018

See all articles by Benjamin Ezugwu Onodi

Benjamin Ezugwu Onodi

Michael Okpara University of Agriculture

Innocent Augustine Nwaorgu

Michael Okpara University of Agriculture - Department of Accounting

Sarah Joy Edibo

Michael Okpara University of Agriculture - Department of Accounting

Mary-Fidelis Chidoziem Abiahu

Nnamdi Azikiwe University - Department of Accountancy

Date Written: June 30, 2018

Abstract

This work examined the relationship between convergence of accounting standards and the financial reporting quality of brewery industry in Nigeria. The main objective of the study is to determine the effect of (pre and post) IFRS adoption on market value per share of Guinness Breweries Plc. Time series data were collected for period of ten (10) years (2006 to 2016)- five years before and five years after adoption of IFRS by quoted brewery companies in Nigeria. The proxies for IFRS adoption were earnings per share, market share, return on assets, while proxy for dependent variable was market value per share. The study made used of multiple linear regression and Analysis of Variance (ANOVA). Two hypotheses were formulated and tested and the result revealed that pre-IFRS adoption has no significant effect on market value per share, while post-IFRS adoption result shows that there is a significant effect on market value per share. Based on the above development, we conclude that there is need for convergence of accounting standards. Financial statements of a large number of companies are used outside their own domestic borders and investors in international markets, need to be sure that the information on which they base their assessments is compiled, using accounting principles recognized in their own country and comparable with others regardless of the country of origin.

Keywords: Convergence, Accounting Standards, Financial Reporting Quality and Brewery Industry in Nigeria

JEL Classification: M40

Suggested Citation

Onodi, Benjamin Ezugwu and Nwaorgu, Innocent Augustine and Edibo, Sarah Joy and Abiahu, Mary-Fidelis Chidoziem, Convergence of Accounting Standards and Financial Reporting Quality of Brewery Industry in Nigeria (June 30, 2018). Onodi, B.E., Nwaorgu, I. A., Edibo, S. J. & Abiahu, M. C. (2018). Proceedings of 4th Annual International Academic Conference on Accounting and Finance., Available at SSRN: https://ssrn.com/abstract=3209797

Benjamin Ezugwu Onodi

Michael Okpara University of Agriculture ( email )

Umuahia-Ikot Ekpene Road
PMB 7267
Umudike, Abia State 440001
Nigeria

Innocent Augustine Nwaorgu

Michael Okpara University of Agriculture - Department of Accounting ( email )

Umuahia-Ikot Ekpene Road
PMB 7267
Umudike, Abia State 440001
Nigeria

Sarah Joy Edibo

Michael Okpara University of Agriculture - Department of Accounting ( email )

Umuahia-Ikot Ekpene Road
PMB 7267
Umudike, Abia State 440001
Nigeria

Mary-Fidelis Chidoziem Abiahu (Contact Author)

Nnamdi Azikiwe University - Department of Accountancy ( email )

Awka, Anambra 23400
Nigeria

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