The Impact of International Auditing Standards on Nigerian Financial Reporting: A Case Study of Seplat Energy Plc
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Background of the Study
International Auditing Standards (IAS) are critical in harmonizing financial reporting practices, promoting transparency, and enhancing investor confidence. These standards, issued by the International Auditing and Assurance Standards Board (IAASB), provide a framework for conducting audits in line with global best practices.
In Nigeria, the adoption of IAS has been instrumental in improving financial reporting quality, especially in publicly listed companies. Seplat Energy Plc, a leading oil and gas company in Nigeria, operates within a complex regulatory and operational environment. Compliance with international auditing standards ensures that the company’s financial statements are transparent, consistent, and reliable, meeting the expectations of global stakeholders (Egbunike & Onyekwelu, 2024).
Despite the benefits, implementing IAS in Nigeria poses challenges, including inadequate auditor training, resistance to change, and limited resources. This study explores the impact of IAS on Nigerian financial reporting, using Seplat Energy Plc as a case study, to highlight the benefits, challenges, and opportunities associated with these standards.
Statement of the Problem
While IAS aim to standardize auditing and financial reporting practices globally, their implementation in Nigeria faces significant hurdles. Issues such as lack of expertise, insufficient regulatory enforcement, and cultural resistance hinder the effective adoption of these standards.
Seplat Energy Plc, as a prominent player in Nigeria’s oil and gas industry, provides a unique context to examine the impact of IAS on financial reporting. However, existing research on the subject remains limited, with most studies focusing on developed economies. This study seeks to address this gap by evaluating the implications of IAS for financial reporting in Nigeria.
Objectives of the Study
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To assess the impact of International Auditing Standards on financial reporting quality at Seplat Energy Plc.
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To identify challenges faced by Seplat Energy Plc in implementing International Auditing Standards.
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To evaluate the benefits of adopting IAS for stakeholders of Seplat Energy Plc.
Research Questions
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What is the impact of International Auditing Standards on financial reporting quality at Seplat Energy Plc?
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What challenges does Seplat Energy Plc face in implementing International Auditing Standards?
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What are the benefits of adopting IAS for stakeholders of Seplat Energy Plc?
Research Hypotheses
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H₀: International Auditing Standards do not significantly improve financial reporting quality at Seplat Energy Plc.
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H₀: Seplat Energy Plc does not face significant challenges in implementing International Auditing Standards.
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H₀: Adopting International Auditing Standards does not provide significant benefits to stakeholders of Seplat Energy Plc.
Scope and Limitations of the Study
The study focuses on Seplat Energy Plc and its financial reporting practices from 2023 to 2025, emphasizing the impact of IAS. Limitations include restricted access to proprietary audit data and potential biases in responses from stakeholders.
Definitions of Terms
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International Auditing Standards (IAS): Guidelines issued by the IAASB to promote uniformity in audit practices globally.
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Financial Reporting: The disclosure of financial information by an organization to its stakeholders.
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Seplat Energy Plc: A leading Nigerian oil and gas company listed on both the Nigerian Stock Exchange and the London Stock Exchange.
