Creative Accounting and Investor Value: A Comparative Study of Income Smoothing of Listed Manufacturing Firms in Nigeria and South Africa

Mary Eberechukwu Ozondu, Okoi Etim Iwara, Stella Ehis Okeke, Geoffrey Ndubuisi Udefi, Azubuike Clifford Romaine, Faith Ukamaka Chinweuba, Peter Chukwuka Ohabuenyi, Uju Francisca Onah and Onyekachi David Chukwunwike

Journal of Management World, 2025, vol. 2025, issue 1, 618-625

Abstract: Given the mixed results of prior studies, this study determined the effect of creative accounting on the investor value of listed manufacturing firms in Nigeria and South Africa from 2012 to 2022. The study investigated the effect of income smoothing on Tobin’s Q of listed manufacturing firms in Nigeria and South Africa. The study obtained data from Thomson One Banker concerning 25 and 44 manufacturing firms listed on the Nigerian Exchange Group and Johannesburg Stock Exchange respectively. The study reveals amongst other things, that income smooth does not significantly affect the investor value of listed manufacturing firms in Nigeria and South Africa. Also, one of the findings indicates that profitability significantly and positively moderated the income smoothing-investor value relationship of listed manufacturing firms in Nigeria and South Africa. The study recommends that firms reconsider their income-smoothing strategy, and factor in profitability in their income-smoothing decision.

Keywords: Creative accounting; Income smoothing; Investors value; South Africa; Tobin’s Q; Nigeria. (search for similar items in EconPapers)
Date: 2025
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