Creative Accounting Practices and Financial Performance of Financial Firms in Nigeria

Apete Collins; Asudo Daniel

doi:10.56201/jafm.vol.12.no8.2026.p239.246

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Creative Accounting Practices and Financial Performance of Financial Firms in Nigeria

Apete Collins, Asudo Daniel

Abstract

This Study ascertained the effect of creative accounting practices on the financial performance of selected financial firms. In Nigeria Data were extracted form annual reports and accounts of the samples banks in Nigeria spanning from 2013 to 2024. Regression analysis was applied to test the hypothesis. The result revealed that there was a significant effect between discretionary accruals and return on equity of financial firms in Nigeria. Based on the findings, the study recommended that management of Financial Firms, CBN should continue strict monitoring of Loan Loss Provisions under IFRS 9 Expected Credit Loss model, which is the main tool for bank earnings management. Banks should improve transparency in LLP disclosure to allow investors to differentiate between non-discretionary and discretionary provisions Key words: Discretionary accruals, Return on equity and Financial firms

Keywords

Discretionary accrualsReturn on equity and Financial firms

References

Adebayo, C. O., & Olanipekun, C. T. (2025). Creative accounting practices and financial performance of deposit money banks in Nigeria. FUOYE Journal of Accounting and Management Sciences, 8(1). Central Bank of Nigeria. (2021, April 29). Statement of CBN Governor Godwin Emefiele on the management change at First Bank of Nigeria Limited. Retrieved from https://nairametrics.com/2021/04/29/full-statement-of-emefieles-sacking-of-fbn- holdings-board/ Indriani, A. D., & Pujiono, P. (2021). Analysis of earnings management practices using the modified Jones model on the industry company index Kompas 100. The Indonesian Accounting Review, 11(1), 235 to 243. Nairametrics. (2021). CBN sacks all board members of FBN Holdings, First Bank of Nigeria. Retrieved from https://nairametrics.com/2021/04/29/breaking-cbn-sacks-all-board- members-of-first-bank-of-nigeria-first-bank-of-nigeria-holding/ Nnvin, J. M., Adegbie, F. F., & Ashogbon, F. O. (2024). Creative accounting and corporate failure in Nigerian manufacturing companies. International Journal of Novel Research and Development, 9(4), a44 to a62. Ogunbode, O. S., Adegbie, F. F., & Akinwumi, D. T. (2026). Aggressive earnings management and shareholders interest in profit listed oil and gas companies in Nigeria. International Journal of Latest Technology in Engineering, Management and Applied Science, 15(1), 1324 to 1335. Onah, V. C. (2023). Exploring the impact of creative accounting on financial reporting in Nigeria: An analysis of the techniques, reasons and regulations. International Journal of Multidisciplinary Research and Growth Evaluation. Onuoha, I. P. (2024). Insights on financial statement fraud and its implications on the financial performance of selected manufacturing industries in Nigeria: An in-depth study of Cadbury Nigeria Plc. Global Research Journal of Accounting and Finance, 5(1).

Creative Accounting Practices and Financial Performance of Financial Firms in Nigeria

Abstract

Keywords

References

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