EARNINGS QUALITY AND SUSTAINABILITY OF LISTED NON-FINANCIAL FIRMS IN NIGERIA
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Date
2025-12-20
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Fuoye Journal of Accounting and Management
Abstract
Despite growing awareness that sustainability drives long-term economic and social development, the sustainability of Nigerian firms seems to be undermined by low-quality earnings arising from managerial opportunistic discretion, accrual manipulation, and income smoothing. Thus, this study examines the effect of earnings quality on the sustainability of listed non-financial firms in Nigeria. An ex post facto research design was employed, using secondary data which were sourced from the annual reports of sampled non-financial firms listed on NGX and a multiple regression analysis was conducted after the descriptive and preliminary analyses. The results revealed that all four earnings quality dimensions significantly and positively affect sustainability performance: accrual quality (β = 0.212, p < 0.001), earnings persistence (β = 0.168, p < 0.05), earnings prediction (β = 0.121, p < 0.01), and earnings smoothness (β = 0.093, p < 0.05). The study concludes that accrual quality, consistent earnings pattern, strong earnings predictability and balanced earnings smoothness are vital determinants of sustainability performance. It is therefore recommended that rigorous earnings-quality mechanisms should be institutionalised to reinforce sustainable performance.
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Kadir, A. O. (2025). Earnings quality and sustainability of listed non-financial firms in Nigeria. Fuoye Journal of Accounting and Management, 8(2).76-93