Abstract
The study examined the relevance of the statement of cash flow in the measurement of Business performance. The methodology used is a review of relevant and extant literature, First Bank share prices from 2012 -2021 after which a conclusion was made. Statement of cash flow has been a subject of debate among scholars due to some limitations in the preparation of cash flow statements. It was revealed that First Bank share prices that rose from all-time low in 2015 and 2016 to a sudden upsurge in 2018 is a reflection that the share prices did not reflect the intrinsic value of the firm. The information in the financial statement was not adequate to guide the various stakeholders. Failure of First Bank to disclose Central Bank of Nigeria forbearances, amount to material misrepresentation and led to a bubble of the share prices. The quick pick-up of the share prices after the sacked of FBN management is evidence of some investors ' belief in the bubble share prices.
Highlights
The study examined the relevance of the statement of cash flow in the measurement of Business performance
29th April 2021, the media was awash with purported management change of First Bank of Nigeria limited (FBN)
Central Bank posits that FBN has over 31 million customers, deposit base of N4.2trn, shareholder funds of N618bn and NIBs instant payment (NIP) processing capacity of 22% of the industry
Summary
29th April 2021, the media was awash with purported management change of First Bank of Nigeria limited (FBN). Proshare (2021) posits that analysts have reviewed the Audited Annual Accounts of the bank and have noted that there is no place in the bank accounts over the past five years was it mentioned that it was under CBN forbearance programme By not mentioning this material fact , that it was under regulatory forbearance, the bank has misled the financial market in general and the stock market about its state of financial health, thereby resulting in a situation where its traded share price on the floor of the Nigeria Exchange Group (NGX) did not reflect the bank’s intrinsic value. The work is structured into introduction which highlights the motivation for the research work and objective, theoretical and conceptual frame work, empirical review, controversies on the relevance of cash flow, findings and conclusion
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