The Effect of International Financial Reporting Standard (IFRS) among SMEs in Nigeria

• Main Authors: Mustapha, Aliyu A, Muhammad, Yusuf Alkali, Zuru, Nasiru Liman, Kegudu, Danjuma Safiya
• Format: Conference or Workshop Item
• Language: English
• Published: 2017
• Subjects: HB Economic Theory
• Online Access: http://repo.uum.edu.my/24846/1/2nd%20IRC%202017%2083.pdf; http://repo.uum.edu.my/24846/
• Institution: Universiti Utara Malaysia

Purpose: Although, SMEs are making significant contributions to the Nigerian economy, however, financial reporting in the sector has not been researched well.Therefore, this study intends to fill in the gap by determining the effect of IFRS among the Nigerian SMEs.Design: The study adopted Ohlson Model (1995) that has been widely used among researchers in determining the effect of IFRS.The study used 80 SMEs registered in Nigerian Corporate Affairs Commission (CAC) for the period of 2011 to 2016 using pre-and postIFRS adoption of SMEs in Nigeria. Findings: The study findings provided a statistically significant increase of financial reporting after IFRS adoption among the Nigerian SMEs.Particularly, a greater increase in earnings coefficients than book value after IFRS adoption was noticed during the period. Implication: The Nigerian SMEs witnessed the lack of compliance with the Nigerian accounting standards and IFRS knowledge.Therefore, financial reporting provided in the public may not reflect a true view of their financial positions.Several SMEs data could not be provided in the data stream which does not allow us for generalisation. Practical implications: The implication of this study is to provide the usefulness of adopting IFRS among SMEs in Nigeria.Also, to the International Accounting Standard Board (IASB) that are at forefront of the use of IFRS to SMEs that IFRS provides more value relevance of accounting information as they suggested. Originality: This study is the first to look at the effect of IFRS on SMEs for book value and earnings in Nigeria