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Impact of IFRS Adoption on Financial Ratios of Nigerian Deposit Money Banks

Dajen Daniel

Abstract

This work looked at the impact of IFRS adoption on financial ratios of Nigerian Deposit Money Banks. The objectives include the effect of IFRS adoption on profitability ratios of Nigerian listed deposit banks, the effect of IFRS adoption on liquidity position of Nigerian listed deposit banks and the effect of IFRS adoption on leverage ratios of Nigerian listed deposit banks. Several concept and literature were reviewed. The study anchored on the Theory of Isomorphism. The study made use of descriptive and comparative research approach in which data were tested using regression analysis. It is finding out that there was more profit when IFRS was adopted compared to profitability during SAS era. The study recommends among others Users of financial statements should be mindful of the new feature comprehensive income for which we suggest two ratios: the ROA and ROE. These ratios are adapted from the regular ROA/ROE but with the comprehensive income at the numerator.

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