Perceptions of Auditors' Independence in Nigeria

It has been asserted that the value of an auditor's report or auditing services depends on the fundamental assumption that auditors are independent of their clients. This means that if the users of financial statements do not believe that an auditor is independent of a client, they will have little confidence in the auditor's opinion. There have been considerable studies on this issue. However, recent events like the collapse of Enron in the United States of America, the Africa Petroleum saga in Nigeria and Cadbury Nigeria P LC have opened fresh discussions on the vexed issue of auditors' independence. This study therefore examined the issue of auditor/ independence from tlie perspective of various stakeholders. It presents the results from a survey of a sample of auditors, .bank loan executives and financial analysts. The data. were subjected to the one-way analysis of variance (ANOVA). The study found that Nigerian auditors are low on the auditor's independence scale due to a number of factors. The study also made recommendations to mitigate the situation

PUBLICATION OF FINANCIAL FORECASTS:PREDICTIVE ACCURACY AND IMPLICATION FOR USERS OF FINANCIAL REPORTS.

Nonnally, it is the practice of companies to publish forecasts of future prospects dwing mergers, acquisitions, and offer for sale or subscription using the prospectus. Since the forecasted results to some ex tent detenn ine the actual rcp01ted performance of these companies (in tem1s of earnings per share and dividend per share), in vestors and shareholders could request that companies show one to three year forecasts in their annual repo1ts. Despite the significance of profit forecast to investors, little or no attent ion has been paid to its reflection in the annual rep01t of companie

Accounting information and share prices in the food and beverage, and conglomerate sub-sectors of the Nigerian stock exchange

The main objective of the study is to examine whether accounting information is value relevant in both the food and beverage, and the conglomerate subsectors of the Nigerian Stock Exchange (NSE). The study also compared the value relevance of accounting information for both sectors. A random sample of seven companies was selected from a total population of thirteen companies listed in the Food and Beverage subsector of the NSE. The study also took a random sample of another seven companies in the conglomerate subsector. Data were gathered from these companies for the period 2005 to 2014. Using the Ohlson (1995) model and the multiple regression method, we found that market price per share (MPS) is positively, but insignificantly related to book value per share (BVPS) and earnings per share (EPS) in the conglomerate sub sector. On the other hand, for food and beverage sub sector, MPS is positively and significantly related to BVPS and EPS. Accounting information is more value relevant in the food and beverage subsector than the conglomerate subsector as shown by the adjusted R2 of 0.89 for Food and Beverage subsector and 0.15 for the conglomerate sub sector. We recommended that accounting rules should be more sector-specific, and monitoring should be taken more seriously in the conglomerate subsector to enhance value relevance of accounting information in NSE.peer-reviewe

A DESIDERATUM: COMING TO TERMS WITH INFLATION ACCOUNTING

A ccountin~ mechanisms measure tJ/e well - offuess or otherwise of economic units in response to environmentalunfoldings to which it responds in onler to be relevant in meeting users' economic decision neetls. However, inflation remains a fa ctor tr~fling the meaningfitln ess llll tl relevance ofi/CA i11 meeting these neetls. This paper attempts to look 111 the need to entrench 11 general price level 11ccounting as ftlllun ch pat/ for flel1eloping geneml- specijic price level ch11nges in the f uture. Emphasis on the success of this tlrive rel'olves aromul 11 concert by relevant players. This paper is divided into seven parts mtmely, (i) an overview of the utility of HCA in m1 inflationary en vironment, (ii) some criticisms of inflation approximations in R CA, (iii) A British inflation accounting trail, (iv) essential for inflation accounting incumbency on NASB, (v) the government and its expected role, and (vi) conclusion

Audit quality and earnings management in quoted Nigerian banks

The objective of the study is to find out the impact of audit quality on earnings management. The study used a sample of all eighteen banks quoted on the stock exchange as at December, 2010. Data was gathered for the period 2005 to 2010. The cross-sectional year by year regression analysis was performed. Audit quality is measured by using audit fees and auditor change, and abnormal loan loss provision is used to measure earnings management. Though the result was mixed, however, based on the frequency of results for the period of the study, both audit fee and auditor change were positively related to abnormal loan loss provision. This suggests that high audit fee and change in auditor tenure will aggravate earnings management. We recommend that auditor change should not be ceremonial but based on fact of inefficiency and audit fee from each auditor client should be monitored to enforce the five per cent maximum from each client as suggested by Institute of Chartered Accountants code of ethics.peer-reviewe

REPORTING HUMAN ASSET IN PuBLISHED FINANCIAL STATEMENTS

This paper f ocuses on reporting human asset in published financial statements. The need is necessitated by the failure of the prevailing accounting practice to recognize human resource, normally acknowledged to be the most important asset of an organization, in the balance sheet as an asset, but rather the expenditure relating thereto (recruitment and training cost, wages and salaries) are simply expensed in the profit and loss account. This is considered as an anomaly, to the extent that this resource has value, which exceeds the expensed amount. A more valid treatment of human resources is to reflect it as an asset in the balance sheet taking into consideration that it has future economic benefits extending beyond the current period. The finding of the study was that human asset was considered by the. respondents to be the most important asset. Respondents were, therefore, in favour of disclosing both quantitative and qualitative information about human asset in the published financial statements

LONG TERM SOURCES OF FUND AND PROJECT FINANCING: OPTIONS FOR FINANCIAL MANAGERS IN NIGERIA

The capital structure of a firm is vital to its operations, growth, efficiency, maximization of shareholders' wealth and maintenance of their control or ownership. A finan cial manager, while deciding the long-term sources of fund and obtaining optimal mix of the funds, must know the peculiarities of each fund including the benefits, limitations and when to exercise his option

THE DETERMINANTS AND DECISION USEFULNESS OF IFRS 8 ON SEGMENT DISCLOSURES

The paper examined the determinants and decision usefuln ess of segment disclosures under SAS 24 and /FRS 8. The sampling population include 15 listed banks in the Nigerian Stock Exchange between 2010 and 2013 and survey of 126 chartered accountants in Benin Edo State. The findings suggest that there was a 10% increase in the segment disclosures after !FRS 8 adoption. The paired t-test reveals a significant difference in the pre and post !FRS 8 on operating segment disclosure practices of Nigerian bank. Therefore the findings indicate that Nigerian banks provided more disaggregated segmental information. Moreover. whereas profitability and growth rate of sales have significant positive relationship with segment disclosures. the company 's size and age have negative relationship with the segment disclosures. Again. most of the respondents agreed that !FRS 8 was more decision useful than the SAS 24. Therefore, the paper recommends the need for the regulatory authorities to compel Nigerian banks and other companies to segment information relating to the operation