|
Abstract:
This paper investigates the effect of International Financial Reporting Standards (IFRS) on Earnings Management Practice of listed companies in Nigeria. The study was considered on the perspective of the users (Financial Analysts) of the financial reports. Primary source of data was adopted and a sample of 11 Financial Analysts' firms operates in Benin City, Edo State. Statistical analysis used in the study was Pearson Product Moment Correlation and the result shows that IFRS adoption has negative impact on Earning management practice in Nigeria listed companies. Based on the findings, the study concluded that the adoption of IFRS has not reduced earnings management practice in Nigeria listed companies. Rather, IFRS a principles-based standard has created more opportunities for managers to manipulate earnings, due to high level of flexibility and subjectivity characterized by the standards. The study therefore, recommends a need for strong enforcement of good corporate governance; ethical environment should be observed by the government, Central Bank of Nigeria & other regulatory bodies; and the users should analyse cautiously the information provided in the financial statements. The study also recommends for future research to extend the scope of the study to cover large sample size of data.
|
