Ethical Principles and Relevance of Financial Reports of Quoted Companies in Nigeria

Abstract

Financial reports are meant to present relevant accounting information among other qualities required of them. The relevance of financial report is necessary in decision making; investors, lenders and other creditors place reliance on financial reports that reflect predictive and confirmatory financial information. However, some financial information have been known to be distorted or falsified; resulting in irrelevant and misleading reports that are not suitable for decision making. Using survey research design based on a population of 4893 accountants and auditors of 169 quoted companies and four regulatory bodies in Nigeria, the study investigated the relationship between ethical principles and relevance of financial reports. Four hundred copies of the research instrument with a reliability test coefficient of 0.830 using the Cronbach’s alpha statistics were distributed with a 92.5% return rate. Data analysis employed the use of descriptive and inferential statistics. The results indicate that ethical principles influence the relevance of financial reports significantly ( F(4, 366) = 36.721, Adj. R2 = 0.279, p = 0.000). The study recommends continuous ethical orientation for accountants, managers and auditors of Nigerian quoted companies

Keywords: Ethics, Financial reports, Integrity, Quoted companies, Relevance


Article Review Status: Published

Pages: 38-47 (Download PDF)

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