CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The purpose of this research work is to investigate the impact of international financial reporting standard on stock valuation on public company in Nigeria using stock or inventory, total asset, profit are taxes and share capital from 2000-2014. To investigate the level of difference in stock valuation during the pre IFRS and post IFRS period. To measure the extent to which valuation of asset differs in the pre-IFRS and post IFRS etc. the researcher made use of ex-post factor research design with data obtain from annual report of an account of five company quoted on the flow on the stock Exchange. Frequency distribution table and descriptive statistics was used for data presentation and analysis while paired sample T-test was used to test the hypothesis. It was discovered that the adoption of IFRS significantly affect stock valuation of public companies. On these note, it was recommended that the government should amend the Company’s Act in Nigeria for improving compliance, culture, provide guidelines on paper. Implementation of IFAC code of ethics for professional accountant and practitioners.
1.2 STATEMENT OF PROBLEM
Masud, (2013) disclosed that in the accounting and finance sector, companies cook figure and manipulate financial statement, tax avoidance is the norm of the day while persistent earning management is le unchecked by the authorities because of weak and ineective regulation. Most of Nigeria statement of accounting standard (SASS) or NG-GAAP issued by the NASB are out data and considered insuicient to provide the necessary guidance in the preparation of qualitative financial statement. The following challenges exist premeditated this research;
1. Apparent lack of global unifying reporting standard stock valuation assessment of companies in and outside the country. Thus giving rise to disparity in accounting reportage.
2. Presence of fraudulent preaches by corporate entities as regards under valuation of profit for tax purpose with particular emphasis on the use of LIFO method.
3. Increases investment protectial of corporate entity in the country and this heavenly tied to adoption of local accounting standard (GAAP) generally investor are oen time regarded financial statement prepared with local GAAP as inferior and lacking integrities. The researcher noted that adoption of IFRS particular for stock valuation help to address the above challenge. To help confirm these assession, this research is carry out to determined if the adoption IFRS will approve valuation of public companies in Nigeria.