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Abstract
The study examined the benefits and challenges of companies that have adopted IFRS in Nigeria. Specifically, the study was conducted through comparison of the ratios that were computed from IFRS based financial statements and Nigerian GAAP based financial statements of ten (10) commercial banks quoted on the floor of the Nigerian Stock Exchange between 2010 and 2013 (2yrs before IFRS adoption and 2yrs after). Three financial ratios were selected from each of the four major categories of financial ratios which included; profitability, liquidity, leverage and investment. The paired sample t-test and Mann-Whitney test were both employed in testing whether significant difference exists between the pair of ratios after the normality test has been ascertained by the Jarque-Berra tests through descriptive statistics. In all, the result showed that there is no significant difference between the profitability, liquidity, leverage and investment ratios of the sampled firms before and after IFRS adoption at 5% level of significance. Based on the findings of this study, it was recommended that longer years in the post-IFRS adoption period are required in order to ascertain IFRS benefits to Nigerian firms, in terms of financial ratios.
