IAS 8 (ACCOUNTING POLICY, ERRORS & ESTIMATES) AND FINANCIAL REPORTING QUALITY OF LISTED CONSUMER GOODS COMPANIES IN NIGERIA

This study examined how IAS 8 affects the financial reporting quality of listed consumer goods companies in Nigeria. IAS 8 was measured by earnings management incentives and income smoothing selection, while perceived faithful representation was employed to proxy financial reporting quality. Survey research design was adopted by the study. The data for this study was generated through primary source with the use of questionnaires distributed to fifty (50) internal auditors and accounting officers from five (5) listed consumer goods firms in Nigeria. Descriptive statistics, correlations and linear regression were used to analyze the data gathered. Using 0.05 significant threshold, it was found that earnings management incentive has negative and significant effect on perceived faithful representation (β = -0.180, p = 0.002 < 0.05), while income smoothing selection satisfied to positively and significantly affect perceived faithful representation of the Nigerian-listed consumer goods firms under study (β = 0.411, p = 0.000 < 0.05). The study concluded that financial disclosures by the consumer goods firms may not reflect their true underlying economic reality, thereby creating an information gap between corporate management and external stakeholders. The study recommends that accounting regulatory bodies in Nigeria should tighten accounting disclosures through enforcement of stricter disclosure rules regarding management estimates and changes in accounting policies. Meanwhile, the management of Nigerian-listed consumer goods firms should upgrade internal audit frameworks to proactively detect and block opportunistic accounting entries before finalizing financial statements