Accounting Estimate and Financial Performance of Quoted Industrial Goods Manufacturing Companies in Nigeria

The study experimentally examined how accounting estimates affect the financial performance of Nigerian listed industrial products of manufacturing companies. Return on equity and return on assets served as proxies for financial success, while accounting estimates were assessed using provisions for depreciation, bad debt, and noncurrent assets. The study analysed data from 12 purposively selected companies out of 16 listed companies, covering audited financial reports from 2012 to 2022. Using ordinary least squares regression in EViews 10, the results showed that depreciation provisions had a positive but insignificant impact on return on equity while significantly influencing return on assets. Bad debt provisions positively and negligibly affected return on equity but significantly impacted return on assets. Noncurrent asset estimates positively and significantly influenced both return on equity and return on assets. The findings indicate that accounting estimates affect financial performance. The study recommends that companies adopt precise and cautious estimation techniques for depreciation, bad debt, and noncurrent assets. Financial managers and accountants should undergo regular training to improve accounting estimate implementation. Additionally, businesses should prioritise transparency in financial reporting to enhance reliability and investor confidence.