The Effect of IFRS Adoption on the Quality of Financial Reporting of Companies listed in NSE

This study examined the effect of IFRS Adoption on the Quality of Financial Reporting of companies listed in NSE. The objectives of this study are to determine whether there is a significant effect of IFRS adoption on the quality of financial reporting of companies listed in NSE, to appraise the challenges faces by companies in the adoption of IFRS in Nigeria. Stratified random sampling was employed in the study whereby data were collected from 55 randomly selected companies covering the major business sectors in Nigeria. Primary data were gathered through a well-structured questionnaire. Hypotheses were tested and percentage analysis were performed by using Statistical Package of Social Sciences (SPSS). The study reveals that there is a significant effect of IFRS adoption on the quality of financial reporting of companies listed in NSE and also it reveals that most of the companies faces challenges in the adoption of IFRS. Based on these findings, it is recommended that Financial Reporting Council of Nigeria should embark upon aggressive awareness campaign to highlight the overriding benefits of IFRS while the regulatory agencies, companies, the government and other stakeholders should provide adequate training and support to the companies for effective adoption and practice of IFRS in Nigeria. Furthermore, implementation of the standard to its totality by companies should be encouraged and regulatory authorities such as the Securities and Exchange Commission of Nigeria, Financial reporting council of Nigeria and external auditors should monitor strict compliance of the adoption of IFRS.

Keyword: International Financial Reporting Standard, Quality of Financial Reporting, Nigeria stock exchange.