Accounting Information and Share Prices in the Food and Beverage, and Conglomerate sub-sectors of the Nigerian Stock Exchange
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The main objective of the study is to examine whether
accounting information is value relevant in both the food
and beverage, and the conglomerate subseEtors of the
Nigerian Stock Exchange (NSE). The study also compared
the value relevance of accounting information for both
sectors. A random sample of seven companies was
selected from a total population of thirteen companies
listed in the Food and Beverage subsector of the NSE. The
study also took a random sample of another seven
companies in the conglomerate subsector. Data were
gathered from these companies for the period 2005 to
2014. Using the Ohlson (1995) model and the multiple
regression method, we found that market price per share
(MPS) is positively, but insignificantly related to book
value per share (BVPS) and earnings per share (EPS) in
the conglomerate sub sector. On the other hand, for food
and beverage sub sector, MPS is positively and
significantly related to BVPS and EPS. Accounting
information is more value relevant in the food and
beverage subsector than the conglomerate subsector as
shown by the adjusted R2 of 0.89 for Food and Beverage
subsector and 0.15 for the conglomerate sub sector. We
recommended that accounting rules should be more
sector-specific, and monitoring should be taken more
seriously in the conglomerate subsector to enhance value
relevance of accounting information in NSE
Keywords
H Social Sciences (General), HF5601 Accounting