Abstract: This study examines the relationship between Human Resource Accounting (HRA) and accounting conservatism in quoted oil and gas companies in Nigeria. Using a descriptive and explanatory research design, data were collected from annual reports, financial statements, and relevant archival sources of selected firms listed on the Nigerian Exchange Group from 2019 to 2024. Both qualitative and quantitative analyses were conducted, including correlation and regression tests, to assess the impact of human capital recognition on conservative reporting practices. Findings reveal that firms with robust HRA practices demonstrate significantly higher levels of accounting conservatism, characterized by prudent recognition of losses and delayed recognition of gains. Regression results indicate a positive and statistically significant relationship between HRA disclosure and conservative accounting policies (β = 0.462, p < 0.01), suggesting that human capital investments influence the cautious presentation of financial outcomes. Moreover, firms exhibiting structured HRA systems recorded improved transparency and reliability in their financial statements, reducing information asymmetry for stakeholders. The study further highlights that governance mechanisms, such as active audit committees and board oversight, enhance the effectiveness of HRA in promoting conservative reporting. These findings underscore the strategic role of human capital in strengthening financial prudence and provide empirical evidence supporting the integration of HRA into corporate reporting frameworks. The study concludes that the adoption of HRA practices is a significant determinant of accounting conservatism in the Nigerian oil and gas sector, with implications for investors, regulators, and policy makers seeking to improve financial transparency and accountability. The study recommends that quoted oil and gas firms should implement consistent Human Resource Accounting practices, ensuring employee-related investments are properly recognized in financial statements to enhance transparency and accountability.
ADEDOKUN et al. (Tue,) studied this question.