International Financial Accounting Standards (IFRS) in Nigeria: Investors Perspective

Abstract

This study was carried out to ascertain the Nigerian Investors' view on International Financial Reporting Standards (IFRS). Many researches were conducted before IFRS was adopted in Nigeria so as to encourage its adoption but after the adoption of IFRS in Nigeria very few studies have been conducted to verify if truly the acclaimed benefits of IFRS in theory are the same in practices. Also there is little research on the perception of users of IFRS financial information. This study aims to fill in the gap by conducting a research on users of financial reports; focusing majorly on investors. The study made use of primary sources of data in eliciting the required information needed for this research. The sample size consisted of seven (7) firms randomly drawn from list of approved Nigerian stockbrokers. The collected data was tested through Chi-square with the use of Statistical Package for Social Sciences (SPSS). The study finds that IFRS adoption influences investment decision in Nigeria, it has increased confidence of Nigerian investors in the financial statements of company. Also this study was able to show that major percentage of the Investors in Nigeria understands the IFRS reporting of companies. The paper recommends that organization should improve their IFRS communication in the annual report. Users of financial information especially the investing community, consisting of investors and stockbrokers, should endeavor to get more training on IFRS so they can have more understanding and easily interpret IFRS accounts better.