ACCOUNTING ETHICS AND FINANCIAL REPORTING CREDIBILITY IN NIGERIA

Abstract

Financial statements produced through financial reporting process forms the basis for stakeholders’ decision hence its credibility must not be compromised. The study investigated the relationship between accounting ethics and financial reporting credibility. The study adopts positivist paradigm and descriptive survey design and targets practicing accountants, auditors, financial controllers, and finance managers across public and private organizations within Nigeria, particularly members of professional bodies like ICAN and ANAN. Stratified random sampling and personal judgement were combined to arrive at 150 sample size. Primary data was collected using the modified 4-point Likert scale questionnaires while data analyses was executed using linear regression. Findings showed that integrity, objectivity, professional competence and due care, and professional behaviour are significantly related with financial statement credibility with 0.000 and 0.629, 0.000 and 0.778, 0.000 and 0.778, and 0.001 and 0. and 0.575 p-values and r² values respectively. While confidentiality has insignificant relationship with FRC with p and r² values of 0.416 and 0,048. The result further showed a very high correlation between combined dimensions of accounting ethics and financial reporting credibility and a significant relationship at 0.879 and 0.000. The study recommended prioritising integrity; promote policies that identify and mitigate conflicts of interest; organise continuous professional development programmes to build competence; confidentiality policies should be r institutionalize within financial reporting frameworks; create ethics helpdesks where professionals can seek advice in grey areas of decision-making; and comprehensive ethical compliance framework should be developed and adopted. The study concludes that accounting ethics relates significantly with financial statement credibility.