Effect of International Financial Reporting Standard Adoption on Financial Performance of Listed Money Depositing Banks in Nigeria

Abstract

The motivation of this study is derived from prior studies which relate to the investigation of IFRS impact on the financial performance of money depositing banks listed on NSE. It examines the effect of the adoption of the International Financial Reporting Standards on the financial performance of money depositing banks. A Wilcoxon model is explored using pooled data that fitted with the variables. The results show that IFRS adoption has positively impacted some variables in the financial statement of money depositing banks, for example, profitability and growth potential. Based on the evidence in support of modernization theory, government should encourage and support money depositing banks in the adoption and application of IFRS in order to improve their performance. Future research may also identify the specific provisions of IFRS that are responsible for the positive impact on financial performance measures. Such detailed knowledge is useful to standard setters who may wish to improve existing accounting standards. Further research should extend the sample size and the time horizon of the study in order to add to the findings reported here.

Keywords: IFRS, Financial Performance, Money Deposit Banks, Nigerian Stock Exchange.