The Influence Of International Financial Reporting Standards (IFRS) On Financial Reporting Quality In Nigeria

The Influence Of International Financial Reporting Standards (IFRS) On Financial Reporting Quality In Nigeria

Abstract

The study focuses on the quality process of International Financial ReportingStandard( IFRS) on a developing frugality, with particular reference toNigeria.The exploration work is grounded on the data attained from literature check and archival sources in the environment of the globalization of International Financial Reporting and the quality of International Financial Reporting norms( IFRS). The primary source of data collection which consists of particular interview and questionnaire were used in gathering data from repliers. It was set up that Nigeria has embraced IFRS in order to share in the benefits it offers, including attracting foreign direct investment, reduction of the cost of doing business, and cross border table. It was concluded that enforcing IFRS Nigeria will face challenges including the development of a legal and nonsupervisory frame, mindfulness crusade, and training of labor force. It was recommended among others that Nigeria should have their own interpretation of IFRS if they can’t borrow IFRS in full just as Argentina and England.

Chapter One

Preface

Background to the Study

There are presently two main seminaries of study in the debate on International Financial Reporting norms( IFRS) and account adjustment or confluence. The proponents argue that a single global set of account norms helps reduce information asymmetry, lowers the cost of capital, and increases capital inflow across borders. The opponents argue that the characteristics of original business surroundings and institutional fabrics determine the form and contents of account norms. therefore, counting norms in two countries need not be the same and the use of IFRS doesn’t inescapably ameliorate counting quality( Khan & Mayes, 2009). Since further and further enterprises and countries have espoused IFRS or considered replacing their public norms with IFRS, in pace with the rapid-fire development of profitable globalization and the worldwide integration of capital requests since the 1990s, it’s the right time to estimate the impact of IFRS on counting quality for the early adopters( enterprises and Countries) of IFRS.

With the collapse of US Energy mammoth( Enron), WorldCom,etc. the account profession came under sharp scrutiny. This led a disturbed and bewildered global public, questioning the accountant’s capability, integrity and the actuality of norms in commercial governance. Countries that heretofore believed account norms were impermeable set up out that to realize the full earnings of cross border table; no individual country can act alone in its fiscal reporting norms.

Confluence gives IFRS norms an authority and credibility that can not be equated by any other set of norms. There’s growing substantiation that the world economics are more connected andsymbiotic than anyone can really understand. Judging from the global fiscal extremity, ii is egregious that nations that are truly desirous ofmoving forward are now aiming to flee their countries from the limits ofthe present system of fiscal reporting norms.

Adams( 2006) noted that Nigeria is part of ’ this globalization, inrecent times a number of Nigerian companies have raised capital form transnational stock requests; others have established significant presence in other authorities. Also, a good number of Nigerian realities hold the securities ofnon-Nigerian issuers.

thus, for a better understanding and appreciation of the pitfalls and, accordingly, making opinions about the inflow of ’ profitable capital, it makes sense that fiscal statements prepared in Nigeria use global fiscal reporting marks. With these data, the Federal Executive Council accepted the recommendation of the Committee on the Roadmap to the Relinquishment of IFRS in Nigeria that it’ll be in the interest of the Nigerian frugality for reporting realities in Nigeria to borrow encyclopedically accepted, high- quality account norms by completely clustering Nigerian a National Accounting norms with International Financial Reporting norms( IFRS)( Blondal, 2004).

Statement of Problem

This study is accepted to examine the IFRS among accountants in Nigeria. For the purpose of this exploration study problem will be put in question frame. These are some of the exploration questions the study seeks to fine answers to

1. Is it delicate to pierce IFRS with capital inflow across border?

2. Is IFRS important to Nigeria frugality?

3. Is Nigeria accountant apprehensive of the IFRS?

Exploration Questions

In order to achieve the end of this study the following questions bear an answer;

1. Will the relinquishment of IFRS enhance effectiveness of fiscal reporting in Public Sector?

2. Is there any relationship between capital inflow across borders andIFRS?

3. Is there any relationship between IFRS and fiscal report in Nigeria Economy?

4. Does Nigeria fiscal report has any knowledge of IFRS?

Objects Of The Study

The following are the ideal of the study

1. To find out if the relinquishment of IFRS will enhance effectiveness of fiscal reporting in Public Sector.

2. To ascertain if there’s any relationship between capital inflow across borders and IFRS.

3. To ascertain if there’s any relationship between IFRS and fiscal report in Nigeria Economy?

4. To find out if Nigeria fiscal report has any knowledge of IFRS.

Statement of Suppositions

thesis is a conditional academic state of relationship between two or further variable. Dankwambo( 2009) transition to IPSAS and their impact on translucency it’s frequently state the relationship between independent and dependent variables. The following are suppositions( null thesis and indispensable thesis) of the study

thesis One

HO Relinquishment of IFRS doesn’t enhance effectiveness of fiscal reporting in the public sector.

HI Relinquishment of IFRS enhances effectiveness of fiscal reporting in the public sector.

thesis Two

HO There’s no relationship between capital inflow across borders andIFRS.

HI There’s a relationship between capital inflow across borders and IFRS

thesis Three

HO There’s no relationship between IFRS and fiscal report in Nigeria frugality

HI There’s relationship between IFRS and fiscal reporting in Nigeria frugality

thesis Four

HO Nigeria fiscal report has no knowledge of IFRS

HI Nigeria fiscal report has knowledge of IFRS

Significance of the Study

The study will place emphasis on the significance of IFRS in counting quality as a base for medication of fiscal statement in Nigeria. The following will profit from the study

1. The study will enlighten accountants on the rearmost development in counting profession.

2. The study will attract implicit investors to the company.

3. The study will also enable Nigeria Accounting standard Board( NASB) to acclimate to transnational standard.

The scholars, administrator, government, and the general public will also profit from it.

Compass Of The Study

The study critically examines the influence of International Financial Reporting norms( IFRS) on fiscal reporting quality in Nigeria, the study has a limited compass because to look at quality of IFRSs amongst accountants in Nigeria. The time is framed between 2008 and 2015 and a large sample size of 216 was used during the course of the exploration for effectiveness.

Limitations of the Study

Studies of this nature are bound to be limited by constraints in the course of the finding. The entourages were encountered.

1. Data collection Well established data aren’t fluently available.

2. Sizeable volume of information attained from papers were in association and occasionally complex.

3. Disinclination of the replier to fill the questionnaires.

Description Of Terms

Accrual Accounting Accrual Accounting is an account methodology under which deals are honored as the underpinning profitable events occurs, anyhow of the timing of the affiliated cash bills and payments( Khan and Mayes, 2009). Following this methodology, profit is honored when income is earned, and charges are honored when arrears are incurred or resource consumed. addendum bases counting match’s earnings to the time period in which they’re incurred, Blondal( 2004). While it’s more complex than cash base account, this discrepancy with the cash account base under which earnings and expenditures are honored when cash is entered and paid independently.

Account system The transition to IFRS may bear an reality to take over significant changes to their core fiscal systems. The extent of these changes will depend on the current fiscal systems espoused by realities. Significant changes in systems may lead to an increased threat in the trustability of information produced from the systems.

Quality statement It’s in the stylish interest of the nation to borrow the IFRS. The transition should be phased so that the objects are achieved within the time- frame as outlined in the roadmap.

IFRS IFRS a set of transnational account norms stating how particular types of deals and other events should be reported in fiscal statements

Account Quality The ideal of fiscal reporting is to give information about fiscal position, performance and changes in fiscal position of an reality that’s useful in making profitable opinions for a wide range of druggies, similar as investors, workers, lenders, suppliers government and public in general.