International Financial Reporting Standards and Financial Reporting Quality Among Nigerian Listed Firms

This study examines the effect of International Financial Reporting Standards (IFRS) adoption on financial reporting quality (FRQ) among 148 firms listed on the Nigerian Exchange Group (NGX) over the period 2012–2025. Anchored in agency theory, institutional theory, and positive accounting theory, the study employs an ex-post facto research design and a balanced panel regression framework. Financial reporting quality is operationalised through discretionary accruals estimated via the Modified Jones Model. The main explanatory variable IFRS adoption is measured using a post-adoption year dummy that captures the full compliance era commencing January 2012, while control variables include firm size (natural logarithm of total assets), return on assets (ROA), leverage (debt-to-equity ratio), a Big 4 audit firm dummy, board independence (proportion of non-executive directors to total board members), industry dummies, and year dummies. Panel regression results validated through Hausman specification tests, Breusch–Pagan Lagrange Multiplier tests, variance inflation factor analysis, modified Wald tests for heteroskedasticity, and Wooldridge tests for serial correlation reveal that IFRS adoption significantly improves financial reporting quality among Nigerian listed firms. Big 4 audit firm engagement and board independence further reinforce reporting quality, while leverage exerts a significant negative effect. Firm size and ROA are positively and significantly associated with FRQ. Industry and year dummies capture cross-sectional and temporal heterogeneity. These findings carry broad implications for regulators, policymakers, standard-setters, and practitioners in emerging economies navigating the terrain of global accounting harmonisation.