International Financial Reporting Standards and Financial Reporting Quality of Listed Oil and Gas Industry in Nigeria

Abstract

The purpose of this study is to evaluate how Nigerian listed oil and gas companies’ financial reporting have been affected by the implementation of IFRS. The study used purposive sample technique to select Six (6) oil and gas companies from a total of nine companies between 2018 to 2022. Correlation and regression analysis, among other descriptive and inferential studies were performed on the data gathered. Post-estimation tests were also carried out to reinforce the findings' robustness. Results of regression analysis showed that there is a significant and negative correlation between the implementation of IFRS and earnings management practices (t-stat= -0.1458, p<0.05). implying that once IFRS was implemented, financial report quality significantly improved. This indicates that listed oil and gas companies in Nigeria are becoming more transparent in their financial reporting and are using less income smoothing techniques. It was gathered that listed oil and gas companies in Nigeria have seen an improvement in the quality of their financial statements since the adoption of IFRS. Hence, businesses are urged to give accurate and open reporting first priority. The IFRS framework should be tightened by policy makers and standard-setters in order to decrease subjective assessments and discretionary accruals and improve the overall dependability and comparability of financial reports.