Impact of earnings management on market values of listed quoted companies in Nigeria

This research investigates how manipulating earnings management affects the market value of quoted Nigerian Companies. The study analyzed 51 companies from various sectors, assessing earnings quality through four measures: the quality of accruals, the consistency of earnings, the predictability of earnings, and the smoothness of earnings. The analysis used a fixed-effect regression model with panel data from corporate financial reports. The findings indicate that better accrual quality is associated with lower market value. Conversely, consistent earnings positively impact valuation, signaling stable performance. Predictable earnings significantly increase market value, appealing to investors. Interestingly, smoother earnings seem to negatively affect valuation, suggesting that markets may view smoothing with suspicion. This research provides valuable insights for Nigerian capital market stakeholders, including regulators, investors, and corporate executives, especially in understanding the complexities of earnings manipulation in emerging economies.