EARNINGS MANAGEMENT AND FIRM FINANCIAL PERFORMANCE

ABSTRACT

The study explored earnings management and organizational performance as an important consideration because it reveals and determines an organization’s future viability. This study highlighted the benefit of financial statement in real time, the research questions, research hypothesis and the research objectives. The objectives of this study aimed to examine the impact of earnings management on the firm’s financial performance using Dangote PLC as the case study, and also to examine the impact of Earnings per share manipulation(E/PM), Accruals earnings manipulation(AEM), Firm Size manipulation (FSM) and Market book value manipulation(MBVM) on the Return on assets(ROA) as a measure of firm’s financial performance using Dangote Plc as case study. Two hypotheses were formulated to guide the investigation exercise. Secondary data was used in this study to obtain the required data. The key findings included the importance of financial statements which cannot be overemphasized. Financial statement is especially important in a publicly traded business as it is the sole way for investors and owners to see how the company operates. By carefully analyzing the financial reports of the firm and understanding the impact of earnings management, this study provides an insight into the true performance of the firm.