The Adoption of IFRS and Earnings Quality of Financial Statements of Nigerian Breweries Plc: Generalised Linear Model Approach

Abstract

The adoption of IFRS is expected to improve the earnings quality of firms that adopt them. It is against this background that this study investigated how the adoption of IFRS has affected earnings quality of Nigerian Breweries Plc. The company was selected because of its importance to the Nigerian economy. The 18 -year research period (2003 – 2020) was divided equally between (2003 – 2011) Pre- IFRS period (9 years) and (2012 – 2020) Post – IFRS period (9 years). Data on share price and Earnings per Share used to calculate earnings yield and change in earnings yield used to proxy earnings quality were sourced from the published financial statements of the company. Findings from Generalized Linear Model revealed no improvement in the earnings quality of the company after the adoption. Findings further showed that the company faced a lot of macro and micro economic challenges that affected its operating performances during the research period. The study therefore recommends to government to address those ident fied challenges because of the importance of the industry to the Nigerian economy.