VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS
Switch from Statement of Accounting Standard (SAS) to the International Financial Reporting Standards (IFRS) in Nigeria requires reporting entities to mark-to-market financial assets and liabilities and to recognise holding gains and losses as items of other comprehensive income. The objective of t...
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| Format: | Article |
| Language: | English |
| Published: |
Kwara State University, Malete Nigeria
2024-10-01
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| Series: | Malete Journal of Accounting and Finance |
| Subjects: | |
| Online Access: | https://majaf.com.ng/index.php/majaf/article/view/155 |
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| _version_ | 1823857168078602240 |
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| author | Aliyu Baba Usman Ndagi Salihu Isah Ibrahim Shuaibu Bawa Wuse |
| author_facet | Aliyu Baba Usman Ndagi Salihu Isah Ibrahim Shuaibu Bawa Wuse |
| author_sort | Aliyu Baba Usman |
| collection | DOAJ |
| description |
Switch from Statement of Accounting Standard (SAS) to the International Financial Reporting
Standards (IFRS) in Nigeria requires reporting entities to mark-to-market financial assets and
liabilities and to recognise holding gains and losses as items of other comprehensive income.
The objective of this study is to examine the value relevance of fair value hierarchy information.
A total of 205 annual firm-year observations of non-financial firms listed in the Nigerian
Exchange Group (NGX) spanning 2018 to 2022 was used. The result of multiple regression
indicates that fair value gains and losses measured based on Level 1 and Level 2 were value
relevant, but Level 3 inputs was not. This suggests that investors valued holding gains and
losses quoted in an active market (Level 1) and indirect observable inputs (Level 2). No
evidence to suggest that investors are using unobservable inputs (internally generated, Level
3). It is therefore recommended that reporting entities should ensure best disclosure practice
relating to financial assets and liabilities to enhance reliability of subjective accounting
earnings.
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| format | Article |
| id | doaj-art-e77e6556e94249398192df63e239e2e9 |
| institution | Kabale University |
| issn | 2735-9603 |
| language | English |
| publishDate | 2024-10-01 |
| publisher | Kwara State University, Malete Nigeria |
| record_format | Article |
| series | Malete Journal of Accounting and Finance |
| spelling | doaj-art-e77e6556e94249398192df63e239e2e92025-02-11T23:08:05ZengKwara State University, Malete NigeriaMalete Journal of Accounting and Finance2735-96032024-10-0142VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMSAliyu Baba Usman0Ndagi Salihu1Isah Ibrahim2Shuaibu Bawa Wuse3Ibrahim Badamasi Babangida University, Lapai, Niger State, NigeriaIbrahim Badamasi Babangida University, Lapai, Niger State, NigeriaIbrahim Badamasi Babangida University, Lapai, Niger State, NigeriaIbrahim Badamasi Babangida University, Lapai, Niger State, Nigeria Switch from Statement of Accounting Standard (SAS) to the International Financial Reporting Standards (IFRS) in Nigeria requires reporting entities to mark-to-market financial assets and liabilities and to recognise holding gains and losses as items of other comprehensive income. The objective of this study is to examine the value relevance of fair value hierarchy information. A total of 205 annual firm-year observations of non-financial firms listed in the Nigerian Exchange Group (NGX) spanning 2018 to 2022 was used. The result of multiple regression indicates that fair value gains and losses measured based on Level 1 and Level 2 were value relevant, but Level 3 inputs was not. This suggests that investors valued holding gains and losses quoted in an active market (Level 1) and indirect observable inputs (Level 2). No evidence to suggest that investors are using unobservable inputs (internally generated, Level 3). It is therefore recommended that reporting entities should ensure best disclosure practice relating to financial assets and liabilities to enhance reliability of subjective accounting earnings. https://majaf.com.ng/index.php/majaf/article/view/155comprehensive incomefair value hierarchyvalue relevance |
| spellingShingle | Aliyu Baba Usman Ndagi Salihu Isah Ibrahim Shuaibu Bawa Wuse VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS Malete Journal of Accounting and Finance comprehensive income fair value hierarchy value relevance |
| title | VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS |
| title_full | VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS |
| title_fullStr | VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS |
| title_full_unstemmed | VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS |
| title_short | VALUE RELEVANCE OF FAIR VALUE HIERARCHY INFORMATION OF NIGERIAN NON-FINANCIAL FIRMS |
| title_sort | value relevance of fair value hierarchy information of nigerian non financial firms |
| topic | comprehensive income fair value hierarchy value relevance |
| url | https://majaf.com.ng/index.php/majaf/article/view/155 |
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