Abstract:
The adoption of International Financial Reporting Standards (IFRS) has been achieved based on the prior expectation that IFRS improves the quality of reporting and ensures uniformity of reporting across the globe (Ball, 2016). The purpose of the study is to examine the Impact of International Financial Reporting Standards (IFRS) on the financial performance of the manufacturing sector. This research work covers a period of 14 years Pre IFRS (2006 -2012) and post IFRS (2013-2019). The sample size for this study is ten (10) Manufacturing Companies listed on the Nigerian Stock Exchange. The study adopted Ordinary Least Squares (Gauss-Newton/Marquardt steps) Model and Wald Test Coefficient Restrictions Model as the main analytical tools to test the formulated hypotheses. The study revealed that a weak and insignificant relationship exist between the Nigerian Manufacturing Firms’ Revenue, Profit, Total Assets, and Total Liabilities, and the Nigerian Manufacturing Firms’ Earnings per Share, Return on Assets, and Return on Equity before the adoption of IFRS. Based on the findings, this study recommends that investors should consider the values of earnings, book values of equity, and cash flow from operations in the annual reports of firms prepared in accordance with IFRS before making any investment decision. Finally, the study recommends that management, external auditors and regulators should work together to ensure total compliance by Nigerian Manufacturing Firms in order to achieve IFRS objectives, since enforcement is a necessary tool for ensuring compliance.
