International Financial Reporting Standards Adoption and Financial Statement Quality of Quoted Insurance Firms in Nigeria
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Abstract
The study examined the impact of IFRS adoption on the quality of financial reporting in the insurance industry in Nigeria covering the period 2006 to 2020. The study employed share price as a dependent variable while earnings per share, book value per share, firm size as well as IFRS adoption as explanatory variables. The study employed panel data multiple regression for the analysis. Specifically, the study found that the mandatory adoption of IFRS had a significant positive impact on the share price of insurance firms in Nigeria. Also, the study found that earnings per share and book value per share exerted a significant positive impact on the share price of the firm. However, the impact of firm size is found to be significantly negative. Against this backdrop, it was recommended by the study that aggressive campaigns and modalities that will achieve the rigorous implementation of IFRS adoption should be put in place. Likewise, there should be an adequate assessment of the size of any insurance firm in terms of assets and liabilities that will not jeopardize the growth of the industry as our findings reveal the contrary. Finally, effort should be made by operators in the industry to harmonize some of the cumbersome implementation guidelines to address timeliness in financial reporting.
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