The Effect of Financial Reporting Quality on Corporate Performancein Nigeria

The purpose of this paper is to investigate the effect of financial reporting quality on corporate performance in Nigeria. This research has been performed using a sample of 30 companies quoted on the Nigeria Stock Exchange (NSE). Three proxies were employed for measuring financial reporting quality, namely, earnings quality, accounting conservatism and accruals quality. Panel data were used for the purpose of the study. The relationship between the explained variables and an explanatory variable was observed. The results of the empirical tests were statistically significant at 0.01 and 0.05 levels. The research evidence revealed a significant negative relationship between corruption and financial reporting quality in Nigeria, which implies that the higher the level of corruption, the lower the financial reporting quality in Nigeria. Moreso, a significant positive relationship was found between IFRS and financial reporting quality. This shows that the adoption of IFRS by all quoted companies in Nigeria improves their financial reporting quality. The evidence of the study also found a significant positive relationship between accounting system and financial reporting quality. This revealed that more conservative companies with sound accounting systems enjoy higher financial reporting quality in Nigeria. The findings of the study revealed that financial reporting quality improves corporate performance in Nigeria.