International Financial Reporting Standards’ Adoption and Financial Statement Effects: Evidence from Listed Deposit Money 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 statements of banks. It examines the effects of the adoption of the International Financial Reporting Standards on the financial statements of banks. A regression model is estimated using pooled data and fitted with dependent variables. The results show that IFRS adoption has positively impacted some variables in the financial statement of banks, for example, profitability and growth potential. The paper also reveals that given the fair value perspective of IFRS, the transition to IFRS brings instability in income statement figures. Future research may 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 statement, income statement, fair value, profitability, growth, financial performance measures.