VALUE RELEVANCE OF ACCOUNTING INFORMATION OF QUOTED NIGERIAN FIRMS IN THE INDUSTRIAL GOODS SECTOR: ASSESSMENT OF THE PRE- AND POST- IFRS ERA

Abstract

The possible impact that IFRS adoption may have on the relevance of accounting information of some selected quoted industrial goods sector firms in Nigeria. The studied periods spanned from 2003-2011 (pre-IFRS periods) and 2012-2020 (post-IFRS periods). The sample used in this article consisted of ten (10) readily chosen quoted industrial businesses. In the study, the share price served as both a regressand and a regressor, together with earnings per share and book value per share. The provided data were examined using descriptive statistics, a correlation matrix, and a variance inflation factor. The study opted for the Panel Corrected Standard Error (PSCE) due to heteroskedasticity challenges. The study finds that, on the overall, accounting information produced under the pre-IFRS periods are more value relevant than accounting information produced under the post-IFRS periods. Similarly, earnings per share during pre-IFRS periods have higher value relevance than post-IFRS periods. On the contrary, compared to the pre-IFRS periods, the post-IFRS periods have a higher value relevance for book value per share. The study concludes that the implementation of IFRS has not yet fully boosted the value relevance of accounting information for listed industrial products sector enterprises in Nigeria. As such, the recommends that management of the industrial goods sector firms in Nigeria should continue to adhere strictly to the standards laid down by IFRS for financial reporting and not be selective of standards. This will help to improve the value relevance of what is being reported especially to the stakeholders.
 Keywords: Accounting Information, Value Relevance, Industrial Goods Sector, Firms, Pre- and post-IFRS adoption.